Duterte signs legislation to impose an additional 5 per cent online casino tax.
In 2020, the pandemic had shutdown the economy of the Philippines, as with many neighboring South East Asian countries. The industry that was hurt the most was the casino industry. It was growing at a tremendous pace pre-covid, but was then decimated. 2021 however, has been a turnaround year with online casinos bouncing back into the black.
The past year saw the pandemic force the government’s hand to impose coronavirus restrictions to tackle the infectious delta virus. In doing so, this prevented Chinese workers who had left the Philippines to celebrate Chinese new year in their home towns unable to return. This left a void of live dealer casino roles, that could not be overcome. The inability to provide live casino gaming to the Chinese market led many casino operators to become loss making, some even had to shut down.
As an example, PNXBet, one of the more popular and larger online casinos catering for Chinese players, experienced a reduction of over 50 per cent of gross profit margins.
But earlier this year, restrictions were eased, allowing for an influx of Chinese workers to re-enter and resume live casino gaming.
In the past three months alone, online casino revenue rose by 7 per cent for PAGCOR Casinos and 5 per cent for new casinos.
The GambleDex Philippines Gambling Report, which measures gambling turnover for 2021 year to date, has shows the number of players has returned to pre-pandemic levels.
|PHP million||2019||2020||2021 (Est)|
|Total PAGCOR Casinos||229,964||207,420||231,893|
|Other Licensed Casinos||338,883||98,464||279,599|
|Total New Casinos||1,180,196||350,423||1,093,605|
|Total Gaming Machines Outside of Casinos||173,857||52,293||142,181|
|Bingo (PAGCOR Francise)||3,093||954||2,532|
|Bingo (PAGCOR In House)||528||159||428|
|Total PAGCOR Bingo||3,621||1,113||2,960|
|Interactive Gaming (PhilWeb/PAGCOR)||36,459||10,261||37,101|
This revival of the industry has pleased the government, who had been looking for ways to boost the economy.
“Online casinos are seeing a return to strong profits,” said Stelly Lie, GambleDex Senior Analyst.
“We are even starting to see some online casinos which had moved their operations to Vietnam, Malaysia and Cambodia during the pandemic, begin to transition back to the Philippines. It’s becoming evident that the worst of the pandemic is finally over, and there is a strong upward trend in the business confidence index.”
Back in May 2021, Ms Lie predicted that the Philippines would need to increase taxes on online casino revenues because finance coffers were severely depleted during the lockdown period of 2021.
True to her prediction, this month September 2021, President Duterte signed legislation to increase taxes on gambling revenue by 5 per cent. This is an economically sound policy, one that supports the country in its post pandemic recovery.