While analysts hedge their bets in the growing offshore gaming operations sector, it is actually less beneficial to the domestic economy, according to Senator Joel Villanueva.

The industry, formally known as Philippine offshore gaming operations (POGO), is causing a lot of stress in the real estate market to the detriment of Filipino businesses and workers renting in urban areas to be near their workplaces, explained Villanueva.

“With the way developments in the industry are unfolding, we fear that we are becoming the sin city of China with very little benefit to Filipinos and our economy,” the seasoned legislator said in a statement.

“The industry is to poised to overtake the IT-Business Process Management in office space.”

Office lease prices are shooting upwards because of the increasing demand from POGOs that the industry is now poised to overtake IT-Business Process Management in office space demand by year’s end, according to the veteran lawmaker.

The same is true with residential rent prices with condominium rentals rising at a dizzying pace that it is becoming more expensive for Filipinos to rent near business districts or their places of work, the senator pointed out.

Villanueva, who chaired the Senate labor committee that investigated the influx of illegal foreign workers in the previous congress, shared several reports of Filipino office employees opting not to renew their rents in Makati, Taguig and Pasay because rent prices have doubled or even tripled because of the demand from foreign workers.

“One report we received came from an office worker who paid P25,000 for a condominium unit in Pasay. She did not renew her contract because the unit owner planned to raise rent to P60,000,” he said.

The offshore gaming operations sector also does not create jobs for Filipinos because it hires primarily Chinese workers. The industry explained that it requires native speakers to cater to their clients in the mainland.

“It took three years before the government started collecting taxes from the sector. We are already set back at least P60 billion in foregone revenue,” said Villanueva, citing a Department of Finance (DOF) estimate that the industry should be paying at least P2 billion a month in income taxes.

An inter-agency task force including the DOF signed a memorandum circular that expanded the guidelines and regulations governing foreign workers recently. Among the changes it adopted from the findings of Villanueva-led Senate inquiry are requirement of getting a tax identification number for all foreign workers and the creation of an inter-agency database of foreign workers for monitoring.

“The new industry still needs a closer scrutiny and monitoring.”

For him, the new industry still needs closer scrutiny and monitoring, a role that should have been done by the Philippine Amusement and Gaming Corp. (PAGCOR).

Villanueva took the state gambling regulator to task for the apparent lack of regulation on the offshore gaming industry.

“PAGCOR’s work begins when it issues POGOs the necessary licenses to operate. They should do a better job in regulating offshore gaming firms, just as what they do with conventional gaming establishments such as casinos,” he said.

Villanueva emphasized that the industry is also prone to illegal activities.

“What worries me is if we can’t even tax them properly, how can we assure the public that these POGOs are not being used for illegal activities like money laundering?” he said, as he challenged the Anti-Money Laundering Council to closely monitor the flow of money in the sector.

Villanueva added his office intends to file a resolution in the 18th Congress to closely examine the regulation of POGOs.


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