Calls to Shut Down POGOs Highlight Need for Stronger Gambling Regulation

ASGAM reported that the move is aimed at addressing concerns about tax avoidance and crime related to offshore gaming. 

Senator Gatchalian Calls for New Regulatory Body to Oversee Philippine Gambling Sector

Senator Sherwin Gatchalian, who chairs the Philippines Senate’s Committee on Ways and Means, has called for the establishment of a new regulatory body to oversee the country’s gambling sector. Gatchalian said that the Philippines Offshore Gaming Operators (POGO) industry, which was meant to provide economic benefits, has resulted in creating new opportunities for criminal activities and corrupt practices. 

Gatchalian added that POGOs had underreported gaming revenues, resulting in unpaid taxes, and had jeopardized the country’s relationship with China. He stated that by using currency and employment data as indicators, it could be safely inferred that Chinese citizens are the primary patrons of POGO services. This poses a problem since gambling is against the law in China. Chinese nationals are exploiting the offshore gaming operations situated in the Philippines as a means to evade the Chinese criminal justice system.

Gatchalian proposed a ban on offshore gaming operations and suggested providing assistance to local POGO workers affected by such a ban. He also called for the immediate collection of all outstanding taxes and license fees owed by POGOs, and the cancellation of all working visas and employment permits issued to foreign POGO workers.

Calls for Shutdown of POGOs Sparks Concerns Over Economic Impact

Another senator, Sonny Angara, agreed that POGOs should be shut down but suggested legal POGOs should be given time to wind down their operations. He argued that it would be unfair to shut down POGOs immediately, especially for those who have made substantial investments.

The proposed ban on POGOs has generated mixed reactions. Some see it as an opportunity to address the alleged criminal activities associated with the industry. Others, however, are concerned about the economic impact of a ban on the thousands employed in the sector.

The Philippines’ gambling industry is a significant contributor to the country’s economy, accounting for approximately 1.5% of the GDP. POGOs, in particular, have been a major driver of growth in the industry. In 2019, the industry generated PHP257.8 billion ($4.9 billion) in gross gaming revenues, with POGOs accounting for PHP216.4 billion ($4.1 billion) of the total.

Despite the economic benefits, concerns about the industry have been mounting. Apart from tax evasion and crime, critics have also raised concerns about the social costs of gambling, including addiction and financial ruin.

The government has also been criticized for its lax regulatory oversight of the industry. In recent years, several cases of corruption involving government officials and POGO operators have come to light, raising questions about the industry’s impact on the country’s governance and reputation.