The Department of Finance (DOF) in its presentation to the Senate Committee on Ways and Means last month mentioned the total economic benefits of the Philippine Offshore Gaming Operations (POGOs) amounting to Php166.49 billion annually.
The direct economic benefits include tax revenues, gaming revenues, private consumption spending, real estate and other consumption.
In addition, of about 100,000 total or indirect hires of POGO companies, 65,000 are Filipinos.
Notwithstanding the economic benefits derived from allowing these gaming hubs to operate, we have to acknowledge the costs of POGOs, which include reputational risks that could translate to foregone investments and tourism revenues because of crimes linked to POGOs.
After President Ferdinand R. Marcos, Jr. scored an obvious political pogi point after his State of the Nation Address (SONA) announcement of the ban on POGOs, the question is: Where would the current government get alternative sources of revenues to replace those from soon-to-be-banned POGOs?
Mind you, the Marcos Jr Administration has a high target of collecting Php4.64 Trillion in revenues in 2025.
Finance Secretary Ralph Recto, the author of the much-hated E-Vat Law – an unpopular move of former President Gloria Macapagal Arroyo – said new taxes may be considered if revenue collections fall short. This is a stark contrast to his January 2024 pronouncement that there would be no new taxes until the remainder of PBMM’s term.
Economists point to the importance of judicious budget utilization, especially spending in productive investments like education, health and infrastructure. PBBM’s call for agencies “to wisefully use the budget for urgent priorities and socially impactful programs” however remains an empty rhetoric.
It is quite evident that the Marcos Jr Administration is unable to cut unnecessary spending with its ayuda here, there, and everywhere. We expect this to intensify especially now that we are about to enter an election year.
It is a choice between utang pa more or tax pa more.
The DOF is likewise looking at state asset privatization to ramp up revenues. Over the weekend, the Star City property being eyed for sale for Php15 Billion, has become news.
The DOF, as quoted by news reports, is “planning to conduct an open auction or bidding for the sale of the property ideally this year.”
Then, of course, there is the revival of e-sabong, an issue raised during the House of Representatives budget hearings of the Philippine Amusement and Gaming Corporation and the Philippine Charity Sweepstakes Office.
If our readers would recall, e-sabong, or online betting scheme which involves cockfighting, was stopped by former President Rodrigo Duterte after the disappearance of 30 cockfighters connected with e-sabong operations. The former President then apologized for his late realization of the ill effects of e-sabong to families, which include many bettors incurring heavy debts.
Incidentally, the 2024 Cinemalaya Independent Film Festival axed the premiere of the investigative documentary film “Lost Sabungeros” set on August 8-9, 2024 for security concerns.
Indeed, the ill societal effects bedeviling the controversial e-sabong are the same ones hounding POGOs.
Lone District Santa Rosa, Laguna Rep. Danilo Fernandez sums it best: Same banana.
—
Dennis Ting is a former director of the Department of Budget and Management.
