Philippines mulls listing, tax hike on e-games

The Philippine government is considering sweeping reforms for online gambling operators, including mandatory stock exchange listings and increased taxes, in a bid to tighten oversight and reduce the social costs of gambling addiction.

Finance Secretary Ralph G. Recto said the Department of Finance is proposing new taxes and licensing fees for digital gaming firms, with support from President Ferdinand R. Marcos, Jr.

“We can force them to list so that we know who the people behind it are,” he told reporters on Wednesday. “It becomes more transparent.”

If implemented, the move will place online gaming platforms under similar public scrutiny as listed firms like Bloomberry Resorts Corp. and DigiPlus Interactive Corp., which operate ArenaPlus, BingoPlus and GameZone.

The Philippine Amusement and Gaming Corp. (PAGCOR) collects a 30% rate from e-gaming platforms, while the Bureau of Internal Revenue imposes an additional 5% franchise tax and a 3% auditing fee, bringing the total effective rate to about 38%.

“We may increase that even further,” Mr. Recto said, hinting at a broader effort to boost government revenue and disincentivize unregulated gambling.

Earlier this year, PAGCOR reduced the remittance rate on e-games to 30% from 35% and cut the rate for e-games within integrated resorts to 25%, citing operational expenses of brick-and-mortar venues. Despite these adjustments, illegal gaming remains rampant.

Mr. Recto said about 60% of the gaming market operates illegally. “The losses from uncollected revenue could be around PHP 500 billion, because that PHP 200 billion [in gross gaming revenue] is legal,” he said.

The gross gaming revenue (GGR) is projected to surpass PHP 200 billion this year.

The Finance chief added that the government is also studying whether to tax individual bets placed online, though taxing GGR may be simpler to implement. “We increase [tax] by what? 10%? That’s PHP 20 billion a year,” he said.

Analysts welcomed the proposal to require online gaming firms to go public, citing improved governance and transparency, but said it could squeeze out smaller players.

“Many small players may find it challenging to comply with the requirements and rigors of being a public company, so this could have the effect of favoring larger gaming companies,” Juan Paolo E. Colet, managing director at China Bank Capital Corp., said in a Viber message.

Foundation for Economic Freedom President Calixto V. Chikiamco noted that while transparency is desirable, it might be difficult to require all firms to go public.

“Some may want to remain private,” he said, adding that a feasible strategy could be taxing transactions through digital wallets like GCash.

Economic Planning Secretary Arsenio M. Balisacan has also expressed support for taxing online gaming and its participants, saying e-wallet transaction monitoring could aid tax collection.

John Paolo R. Rivera, a senior research fellow at the Philippine Institute for Development Studies, said mandatory listing could also increase competition. “New entrants with strong digital platforms may attract investor interest and market share.”

Luis A. Limlingan, head of sales at Regina Capital Development Corp., said the entry of more online gaming platforms may pose challenges but could also attract institutional investment and boost legitimacy.

Mr. Recto also clarified that the government is not considering a total ban, despite President Marcos previously ordering the phaseout of Philippine offshore gaming operators.

‘Black markets’

“I don’t think it should be banned,” the Finance chief said. “I think more regulation and higher taxes are enough. Hopefully, with that, the number of people playing will decrease.”

He said a meeting at the presidential palace was recently held to address the proliferation of online lotto platforms not affiliated with the Philippine Charity Sweepstakes Office.

Mr. Recto hinted that further details of the online gaming reform plan could be unveiled in the President’s state of the nation address on July 28.

Meanwhile, DigiPlus urged lawmakers to pursue regulation rather than an outright ban.

“The experience of other countries has shown that banning licensed platforms does not eliminate demand for online gaming, but merely shifts users to unregulated black markets,” it said in a statement on Wednesday night.

The company said a regulated market could protect players, generate billions in revenue, and support more than 40,000 jobs in tech, marketing, entertainment, customer service and compliance.

Shares of DigiPlus plunged 30% or PHP 8.36 to close at PHP 19.54 apiece on Thursday amid regulatory uncertainty.

Company Chairman Eusebio H. Tanco said DigiPlus supports “smart and balanced” regulation. “We believe regulation is the path to player protection. It’s the only way to safeguard players, preserve jobs, and close the door on illegal, underground platforms that operate without any oversight,” he said.

Mr. Tanco said the company is ready to work with lawmakers and regulators to make the Philippines a “model for safe, transparent online gaming in Asia.”

DigiPlus said it already uses strict know-your-customer verification, including government ID checks and age gating, as well as responsible gaming tools like deposit limits, self-exclusion and cooling-off periods.

Upcoming features include enhanced affordability checks, behavioral nudges and referral pathways to mental health professionals. In-app community support spaces and responsible gaming content will also be introduced across its platforms this month.

“These measures are not reactions to regulatory pressure, but part of a multi-year strategy to build a responsible gaming ecosystem,” DigiPlus said.

It added that it supports updated legislation that imposes stiffer penalties on illegal operators and clearer standards for advertising in the digital gaming industry. — Aubrey Rose A. Inosante and Revin Mikhael D. Ochave, Reporters