RR No. 20-2021: Implements RA No. 11590, otherwise known as an “Act Taxing Philippine Offshore Gaming Operations, Amending for the Purpose Sections 22, 25, 27, 28, 106, 108 and Adding New Sections 125-A and 288(G) of the NIRC of 1997, as Amended, and for Other Purposes”

Key points

1. Gaming tax. Offshore Gaming Licensees (OGLs), Philippine-based or foreign-based, pay a gaming tax of five percent (5%) of Gross Gaming Revenue or Receipts, or of the agreed minimum monthly revenue, whichever is higher. It is in lieu of other direct and indirect internal revenue and local taxes, and is remitted not later than the 20th day after each month end.
2. Income tax and VAT. Non-gaming income of Philippine-based OGLs is taxed at twenty-five percent (25%) on income from within and without the Philippines, and of foreign-based OGLs on income from within the Philippines. Accredited Service Providers also pay 25%, and services or goods sold to OGLs paying the 5% gaming tax are zero-rated for VAT, but not if used in non-gaming operations.
3. Foreign employees. Foreign nationals employed and assigned in the Philippines by an OGL or its Accredited Service Provider need a TIN and pay a Final Withholding Tax of twenty-five percent (25%) on gross income, with a minimum of Twelve Thousand Five Hundred Pesos (₱ 12,500.00) per month. The employer withholds and remits monthly.
4. Reports to the BIR. POGO entities submit the Summary List and Status Update on Foreign Nationals Employed Form (Annex A) with attachments not later than the 20th day after each month. Licensing authorities send the Status Report on OGLs Form (Annex B) and the List of Foreign Nationals with Issued Gaming Employment License (Annexes C and C-1) by the same day.
5. Use of revenues. Sixty percent (60%) of gaming tax collected goes to: 60% for the Universal Health Care Act, 20% for the Health Facilities Enhancement Program and 20% for the Sustainable Development Goals.
6. Transition and filing. Existing POGO entities submit the Annex A form for January 1, 2021 to November 30, 2021 on or before December 20, 2021. Returns and payments use the eFPS, and entities registered with an Investment Promotion Agency before RA No. 11534 keep their incentives until the transitory period under Section 311 ends or their license or accreditation expires, whichever is earlier.

Who is affected

• Offshore Gaming Licensees (OGLs)
• Accredited Service Providers
• Foreign nationals employed by OGLs or their service providers
• POGO licensing authorities

Deadlines and effectivity

• Gaming tax remitted by the 20th day after each month end
• Monthly reports by the 20th day after each month
• Existing POGO entities: December 20, 2021