Taxing foreign corporations engaged in POGO
2018 as a supplement to address the registration requirements of a Philippine Offshore Gaming Operations (POGO) licensee that is a foreign corporation. business in the Philippines. This means that a foreign corporation with offshore gaming operations in the Philippines is considered a foreign corporation engaged in business in the Philippines.
Such being the case, the foreign corporation engaged in POGO
resident foreign corporation per the Philippine Tax Code. But, is the BIR in a position to
- cient to constitute doing business in the Philippines?
Before we address this question, it is important to look at the term “doing business”.
there is no criterion as to what constitutes doing business and that each case must be judged based on its circumstance. Doing business implies a continuity of commercial arrangements, and contemplates the exercise of some of the functions normally
prosecution of commercial gain or for the purpose of the business organization, which is consistent with the definition of “doing business” of foreign corporations foreign corporation engaged in online gaming is considered doing business in the Philippines.
From the foregoing, we cannot establish that a foreign corporation is doing business in the Philippines solely by engaging in
of offshore gaming operator.
In the rules and regulations of POGO, a foreign corporation may be considered an offshore
- es of a PAGCOR-accredited ser-
differently, a foreign corporation may outsource components of
It is further stated in the POGO rules and regulations that the online players of the offshore gaming operator are limited to foreign nationals outside the Philippines.
Be that as it may, a foreign corporation, whether or not engaged in trade or business, is taxable only on income earned from sources within the Philippines. The tax situs follows the “source”,
income. This raises the question: