EIGHTEENTH CONGRESS OF THE ) 
REPUBLIC OF THE PHILIPPINES )
Second Regular Session 
)
SENATE
S. No. 2232
■; 
;r
•'iDifur Ol li-f
71 MAY 25 P133
(In substitution of S.B. Nos. 1295 and 2076 taking into consideration
H.B. No. 5777)
Prepared by the Committee on Ways and Means with Senators Recto, Marcos,
and Cayetano as authors
AN ACT
TAXING PHILIPPINE OFFSHORE GAMING OPERATIONS, AMENDING FOR THE 
PURPOSE SECTIONS 22, 25, 27, 28, AND ADDING A NEW SECTION 125-A OF 
THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND FOR 
OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
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SECTION 1. Section 22 of the National Internal Revenue Code of 1997, as
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amended, is hereby further amended to read as follows:
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“SEC. 22. Definitions. - When used in this Title:
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XXX
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(II) THE TERM ‘OFFSHORE GAMING LICENSEE’ (OGL) SHALL
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REFER TO THE OFFSHORE GAMING OPERATOR, WHETHER
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ORGANIZED ABROAD OR IN THE PHILIPPINES, DULY LICENSED AND
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AUTHORIZED, THROUGH A GAMING LICENSE, BY THE PHILIPPINE
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AMUSEMENT AND GAMING CORPORATION OR ANY SPECIAL
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ECONOMIC ZONE AUTHORITY OR TOURISM ZONE AUTHORITY OR
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FREEPORT AUTHORITY TO CONDUCT OFFSHORE GAMING
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OPERATIONS, INCLUDING THE ACCEPTANCE OF BETS FROM 
OFFSHORE CUSTOMERS.
FOR PURPOSES OF THIS SECTION, AN OFFSHORE GAMING 
LICENSEE (OGL) SHALL BE CONSIDERED ENGAGED IN DOING 
BUSINESS IN THE PHILIPPINES.
(JJ) THE TERM OGL-GAMING AGENT SHALL REFER TO THE 
REPRESENTATIVE IN THE PHILIPPINES OF AN OFFSHORE-BASED 
OPERATOR WHO SHALL ACT AS A RESIDENT AGENT FOR THE MERE 
PURPOSE OF RECEIVING SUMMONS, NOTICES AND OTHER LEGAL 
PROCESSES FOR THE OGL AND TO COMPLY WITH DISCLOSURE 
REQUIREMENTS OF THE SECURITIES AND EXCHANGE COMMISSION. 
THE OGL-GAMING AGENT SHALL NOT BE INVOLVED WITH THE 
BUSINESS OPERATIONS OF THE OFFSHORE GAMING LICENSEE AND 
SHALL DERIVE NO INCOME THEREFROM.
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SEC. 2. Section 25 of the National Internal Revenue Code of 1997, as
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amended, is hereby further amended to read as follows:
SEC. 25. Tax on Nonresident Alien Individual. -
(A) XXX
(B) xxx
(C) xxx
(D) xxx
(E) XXX
(F) XXX
(G) ALIEN INDIVIDUALS EMPLOYED BY AN OFFSHORE GAMING 
LICENSEE AND SERVICE PROVIDERS. - ALIEN INDIVIDUALS


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REGARDLESS OF RESIDENCY AND WHO ARE EMPLOYED AND 
ASSIGNED IN THE PHILIPPINES, REGARDLESS OF TERM AND 
CLASS OF WORKING OR EMPLOYMENT PERMIT OR VISA, BY AN 
OFFSHORE GAMING LICENSEE OR ITS SERVICE PROVIDER AS 
DEFINED IN SECTION 125-A AND SECTION 27 (F) OF THIS CODE, 
SHALL PAY A FINAL WITHHOLDING TAX OF TWENTY-FIVE 
PERCENT (25%) ON THEIR GROSS INCOME AS COMPUTED IN THE 
SUCCEEDING PARAGRAPH; PROVIDED, HOWEVER, THAT THE 
MINIMUM FINAL WITHHOLDING TAX DUE FOR ANY TAXABLE 
MONTH FROM SAID PERSONS SHALL NOT BE LOWER THAN 
TWELVE THOUSAND FIVE HUNDRED PESOS (P 12,500.00).
IN COMPUTING THE TAX PROVIDED IN THIS SECTION, GROSS 
INCOME SHALL INCLUDE BASIC SALARY / WAGES, ANNUITIES, 
COMPENSATION, REMUNERATION AND OTHER EMOLUMENTS, 
SUCH AS HONORARIA AND ALLOWANCES RECEIVED FROM SUCH 
SERVICE PROVIDER OR OFFSHORE GAMING LICENSEE.
THE TAX IMPOSED HEREIN SHALL BE WITHHELD AND 
REMITTED IN ACCORDANCE WITH THE PROVISION OF THIS CODE 
AND FAILURE TO DO SO SHALL BE GOVERNED BY THIS CODE. 
FOR THE EFFICIENT ASSESSMENT, VERIFICATION, AND 
ADMINISTRATION OF TAXES IMPOSED IN THIS SECTION, THE 
BUREAU OF IMMIGRATION, THE DEPARTMENT OF LABOR AND 
EMPLOYMENT, THE BUREAU OF INTERNAL REVENUE, AND THE 
PHILIPPINE AMUSEMENT AND GAMING CORPORATION SHALL 
ISSUE JOINT AND CONSOLIDATED RULES AND REGULATIONS 
FOR THE IMPLEMENTATION OF FREE AND EFFICIENT EXCHANGE


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OF INFORMATION AMONG THE SAID AGENCIES IN RELATION TO
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THE PROPER PAYMENT OF TAXES BY PERSONS COVERED
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UNDER THIS SECTION.
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ANY INCOME EARNED FROM ALL OTHER SOURCES WITHIN
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THE PHILIPPINES BY THE ALIEN EMPLOYEE REFERRED TO
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UNDER THIS SUBSECTION SHALL BE SUBJECT TO THE
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PERTINENT INCOME TAX IMPOSED UNDER THIS CODE.
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SEC. 3. Section 27 of the National Internal Revenue Code of 1997, as amended,
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is hereby further amended to read as follows:
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“SEC, 27. Rates of Income Tax on Domestic Corporations. —
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(A) XXX
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(B)xxx
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(C)xxx
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(D)xxx
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(E)xxx
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(F) OFFSHORE GAMING LICENSEES - THE PROVISIONS OF EXISTING
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SPECIAL OR GENERAL LAWS TO THE CONTRARY
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NOTWITHSTANDING, THE NON-GAMING REVENUES OF
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PHILIPPINE-BASED OFFSHORE GAMING LICENSEES AS DULY
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LICENSED BY THE PHILIPPINE AMUSEMENT AND GAMING
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CORPORATION OR ANY SPECIAL ECONOMIC ZONE AUTHORITY
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OR TOURISM ZONE AUTHORITY OR FREEPORT AUTHORITY
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SHALL BE SUBJECT TO AN INCOME TAX EQUIVALENT TO
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TWENTY-FIVE PERCENT (25%) OF THE TAXABLE INCOME
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DERIVED DURING EACH TAXABLE YEAR FROM ALL SOURCES


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WITHIN AND WITHOUT THE PHILIPPINES.
(G) ACCREDITED SERVICE PROVIDERS TO OFFSHORE GAMING 
LICENSEES. - UNLESS OTHERWISE PROVIDED IN THIS CODE, 
ACCREDITED SERVICE PROVIDERS TO OFFSHORE GAMING 
LICENSEES SHALL NOT BE SUBJECT TO THE GAMING TAX 
IMPOSED BY SECTION 125-A BUT SHALL PAY SUCH RATE OF 
TAX AS IMPOSED IN SECTION 27(A) OF THIS CODE, AND SHALL 
BE SUBJECT TO ALL OTHER APPLICABLE LOCAL AND NATIONAL 
TAXES.
FOR PURPOSES OF THIS SECTION, AN ACCREDITED 
SERVICE PROVIDER TO AN OFFSHORE GAMING LICENSEE 
(“SERVICE PROVIDER”) SHALL BE A CORPORATION THAT IS 
DULY CREATED OR ORGANIZED IN THE PHILIPPINES OR UNDER 
ITS LAWS AND DULY AUTHORIZED BY THE PHILIPPINE 
AMUSEMENT AND GAMING CORPORATION OR ANY SPECIAL 
ECONOMIC ZONE AUTHORITY OR TOURISM ZONE AUTHORITY OR 
FREEPORT AUTHORITY TO PROVIDE ANCILLARY SERVICES TO 
AN OFFSHORE GAMING LICENSEE AS DEFINED BY SECTION 125- 
A OF THIS CODE OR TO ANY GAMING LICENSEE OR OPERATOR 
WITH LICENSES FROM OTHER JURISDICTIONS. SUCH ANCILLARY 
SERVICES MAY INCLUDE, BUT SHALL NOT BE LIMITED TO, 
CUSTOMER AND TECHNICAL RELATIONS AND SUPPORT 
INFORMATION TECHNOLOGY, GAMING SOFTWARE, DATA 
PROVISION, PAYMENT SOLUTIONS, AND LIVE STUDIO AND 
STREAMING SERVICES.


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SEC. 4. Section 28 of the National Internal Revenue Code of 1997, as amended, 
is hereby further amended to read as follows:
“SEC. 28. Rates of Income Tax on Foreign Corporations. - 
“(A) Tax on Resident Foreign Corporations. -
“(1) XXX
“xxx
“(7) OFFSHORE GAMING LICENSEES - THE PROVISIONS OF EXISTING 
SPECIAL OR GENERAL LAWS TO THE CONTRARY 
NOTWITHSTANDING, THE NON-GAMING REVENUES ATTRIBUTED TO 
GAME OFFERINGS OR FACILITIES LOCATED WITHIN THE 
PHILIPPINES OF FOREIGN-BASED OFFSHORE GAMING LICENSEES 
AS DEFINED AND DULY LICENSED BY THE PHILIPPINE AMUSEMENT 
AND GAMING CORPORATION OR ANY SPECIAL ECONOMIC ZONE 
AUTHORITY OR TOURISM ZONE AUTHORITY OR FREEPORT 
AUTHORITY SHALL BE SUBJECT TO AN INCOME TAX EQUIVALENT 
TO TWENTY-FIVE PERCENT (25%) OF THE GROSS INCOME DERIVED 
DURING EACH TAXABLE YEAR.
SEC. 5. A new Section designated as Section 125-A of the National, Internal 
Revenue Code of 1997, as amended, is hereby amended to read as follows:
“SEC. 125-A. GAMING TAX ON SERVICES RENDERED BY OFFSHORE 
GAMING LICENSEES. - ANY PROVISION OF EXISTING LAWS, RULES 
OR REGULATIONS TO THE CONTRARY NOTWITHSTANDING, THE 
ENTIRE GROSS GAMING REVENUE OR RECEIPTS OR THE AGREED 
PREDETERMINED MINIMUM MONTHLY REVENUE OR RECEIPTS FROM 
GAMING, WHICHEVER IS HIGHER, SHALL BE LEVIED, ASSESSED,


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AND COLLECTED A GAMING TAX EQUIVALENT TO FIVE PERCENT 
(5%), IN LIEU OF ALL OTHER INTERNAL REVENUE TAXES WITH 
RESPECT TO GAMING INCOME: PROVIDED, THAT THE GAMING TAX 
SHALL BE DIRECTLY REMITTED TO THE BUREAU OF INTERNAL 
REVENUE NOT LATER THAN THE 20TH DAY FOLLOWING THE END OF 
EACH MONTH: PROVIDED, FURTHER, THAT THE PHILIPPINE 
AMUSEMENT AND GAMING CORPORATION OR ANY SPECIAL 
ECONOMIC ZONE AUTHORITY OR TOURISM ZONE AUTHORITY OR 
FREEPORT AUTHORITY MAY IMPOSE REGULATORY FEES ON 
OFFSHORE GAMING LICENSEES WHICH SHALL NOT CUMULATIVELY 
EXCEED TWO PERCENT (2%) OF THE GROSS GAMING REVENUE OR 
RECEIPTS DERIVED FROM GAMING OPERATIONS AND SIMILAR 
RELATED ACTIVITIES OF ALL OFFSHORE GAMING LICENSEES OR A 
PREDETERMINED MINIMUM GUARANTEED FEE, WHICHEVER IS 
HIGHER: PROVIDED, FURTHERMORE, THAT FOR PURPOSES OF THIS 
SECTION, GROSS GAMING REVENUE OR RECEIPTS SHALL MEAN 
GROSS WAGERS LESS PAYOUTS: PROVIDED, FINALLY, THAT THE 
TAKING OF WAGERS MADE IN THE PHILIPPINES SHALL RESULT IN 
THE REVOCATION OF THE LICENSE OF THE OFFSHORE GAMING 
LICENSEE.
THE PHILIPPINE AMUSEMENT AND GAMING CORPORATION OR 
ANY SPECIAL ECONOMIC ZONE AUTHORITY OR TOURISM ZONE 
AUTHORITY OR FREEPORT AUTHORITY SHALL EMPLOY A THIRD- 
PARTY AUDIT PLATFORM THAT WOULD DETERMINE THE GROSS 
GAMING REVENUES OR RECEIPTS OF OFFSHORE GAMING 
LICENSEES. TO ENSURE THAT THE PROPER TAXES AND


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REGULATORY FEES ARE LEVIED, PERIODIC REPORTS ABOUT THE 
RESULTS OF THE OPERATION SHOWING, AMONG OTHERS, THE 
GROSS GAMING REVENUE OR RECEIPTS OF EACH OFFSHORE 
GAMING LICENSEE SHALL BE SUBMITTED TO THE BUREAU OF 
INTERNAL REVENUE BY THE PHILIPPINE AMUSEMENT AND GAMING 
CORPORATION OR ANY SPECIAL ECONOMIC ZONE AUTHORITY OR 
TOURISM ZONE AUTHORITY OR FREEPORT AUTHORITY AS 
CERTIFIED BY THEIR THIRD PARTY AUDITOR.
SEC. 6. Implementing Rules and Regulations. - Within ninety (90) days after the
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effectivity of this Act, the Secretary of Finance shall, upon the recommendation of the
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Commissioner of Internal Revenue, promulgate the necessary rules and regulations for
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its implementation.
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SEC. 7. Separability Clause. - If any provision of this Act shall be held
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unconstitutional or invalid, the other provisions not otherwise affected shall remain in
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full force and effect.
SEC. 8. Repealing Clause. — All laws, decrees, executive orders, rules and
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regulations or parts thereof, including Republic Act No. 9487, othenA/ise known as
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‘‘PAGCOR Charter” and Republic Act No. 11494, otherwise known as the “Bayanihan to
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Recover As One Act”, which are contrary to or inconsistent with this Act are hereby
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repealed, amended or modified accordingly.
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SEC. 9. Effectivity. - This Act shall take effect fifteen (15) days after its
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publication in the Officiai Gazette or in a newspaper of general circulation.
Approved,