P186-M income tax collected from POGO workers in July.

A Joint Memorandum Circular (JMC) signed by various government agencies now requires all foreign nationals – especially employees of Philippine Offshore Gaming Operation (POGOs) – and their employers or withholding agents to have a Tax Identification Number (TIN) from the Bureau of Internal Revenue (BIR) as part of the documentary requirements in securing employment permits and visas.

This will ensure that foreign nationals working in the country pay the right amount of taxes to the government.

Since the JMC’s signing last July 11, the BIR has collected an initial P186 million in withholding taxes from POGOs, and the bureau is projecting to collect an additional P170 million this month in tax payments from these businesses employing foreign nationals.

“The BIR… has already collected P186 million from the notices sent out and is set to collect another P170 million moving forward. This started last month and will be collected on Aug. 10,” Finance Assistant Secretary Dakila Napao said.

Signing the JMC were the Department of Labor and Employment (DOLE), Department of Justice, Bureau of Immigration, BIR, Department of Foreign Affairs, Department of Finance, Department of Environment and Natural Resources, Professional Regulation Commission, and the National Intelligence Coordinating Agency.

Citing BIR data, Napao said that of the 48 notices sent out by the bureau to POGOs directing them to pay the withholding taxes of their foreign workers, 22 have either replied or protested the tax assessments.

The recent one-month collection amount is significant, considering that for 2017, the BIR collected only P175 million in taxes from POGO service providers, according to a report of BIR Commissioner Caesar Dulay to the President.

In a Cabinet meeting Dulay reported that POGO service providers remitted over P579 million in taxes in 2018 and voluntarily paid P789 million in the first half of 2019.

The BIR is now working with the DOLE in developing an interagency database of foreign nationals working in the country to effectively monitor them and ensure that they pay the correct amount of taxes to the government.