BIR, biz groups sign MOA for better service

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September 12, 2024

THE Bureau of Internal Revenue (BIR) has signed a memorandum of agreement with business groups in an effort to further improve taxpayer service.

In a statement, the BIR said the new agreement was signed last September 10 with a multi-sectoral group.

The BIR said that through the multi-sectoral group, the private sector can voice out their concerns with current and proposed polices and regulations of the BIR.

“The BIR welcomes both the old and new members of our multi-sectoral group. The retention of old members and the addition of new members show that our relationship with the private sector is a productive and fruitful one,” BIR commissioner Romeo Lumagui Jr. said.

“The private sector is, and always will be, our partner in nation-building. Regular discourse and exchange of ideas between the BIR and representatives from the private sector will create a more stable taxation system in the Philippines,” Lumagui added.

Returning members of the multi-sectoral group include Philippine Chamber of Commerce and Industry, Tax Management Association of the Philippines, Management Association of the Philippines, Financial Executives Institute of the Philippines, Philippine Institute of Certified Public Accountants, Association of Certified Public Accountants in Public Practice, Association of CPAs in Commerce and Industry, Philippine Exporters Confederation, Inc. and Joint Foreign Chambers of the Philippines.

Meanwhile, the new members include the Federation of Filipino-Chinese Chambers of Commerce and Industry, Inc., Makati Business Club and Alliance of Tech Innovators for the Nation.

Trade deficit widens in July

By

Angela Celis

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September 11, 2024

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The country’s trade deficit widened in July due to the year-on-year increase in the value of imports, data released by the Philippine Statistics Authority (PSA) showed.

The balance of trade in goods in July amounted to -$4.87 billion, indicating a trade deficit with an annual increase of 18 percent.

Value of imported goods in July amounted to $11.12 billion, up 7.2 percent from $10.37 billion in the same month of the previous year.

The commodity group with the highest annual increase in the value of imported goods was electronic products with $268.32 million.

This was followed by iron and steel, which increased by $194.4 million and industrial machinery and equipment with an annual increase of $92.31 million.

Total export sales in July amounted to $6.25 billion, inching up 0.1 percent from the $6.25 billion total export sales in the same month last year.

The commodity group with the highest annual increment in the value of exports in July 2024 was copper concentrates with $115.8 million.

This was followed by other manufactured goods with an annual increase of $105.12 million; and coconut oil with an annual increment of $92.13 million.

In July, the country’s total external trade in goods amounted to $17.37 billion, posting a 4.5 percent increase from the $16.62 billion total external trade in the same period last year.

In a statement, Michael Ricafort, Rizal Commercial Banking Corp. chief economist, said the trade deficit for the month is the widest in more than a year or since March 2023.

Ricafort said this largely reflected the faster growth in imports, due to the stronger peso-dollar exchange rate.

“The seasonal increase in importation activities in 3Q, a consistent pattern seen for many years/decades, could lead to further pick up (in) imports and wider trade deficit, as further peso appreciation vs. the US dollar recently would make imports cheaper while making exports more expensive,” Ricafort said.

Pagcor to slash govt share in betting platforms’ revenues

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Angela Celis

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September 11, 2024

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The Philippine Amusement and Gaming Corp. (Pagcor) is further reducing its gross gaming revenue (GGR) remittance rate for online and on-site betting platforms next year to keep the industry at par with global standards and to encourage more players to legitimize their businesses.

“By Jan. 1, 2025, I wish to announce that we are bringing down the rates further. By then, we are bringing down our license fees to 30 percent for our brick-and-mortar licenses, and down to 25 percent for integrated resorts who are also involved in online gaming,” said Alejandro Tengco, Pagcor chairman and chief executive officer, in his speech at the Inside Asian Gaming Academy Summit held at the Newport World Resorts yesterday.

“By lowering our license fees to be a part of the global industry standards, we hope to attract and keep more investors in place. It should also help curb illegal online gaming operations so that they abandon the gray market and hopefully embrace the mainstream,” Tengco added.

Pagcor significantly reduced its rate shares from online and on-site betting platforms since the early part of 2024.

Last April 1, the GGR remittance rate was brought down to 35 percent.

This is significantly lower compared to the 55 percent prevailing rate when Tengco assumed office in August 2022.

“The observation I made upon my assumption in the office was that the gray market or the underground market was doing so well, way, way better than Pagcor,” Tengco told reporters at the sidelines of the event.

“Licensees were closing shop, primarily because they could not compete anymore with the market,” he added.

Tengco said that in other jurisdictions, the rate is about 30 percent to 35 percent.

“The numbers will show how successful the decision to reduce was, primarily because, one, closures of existing licensees are almost zero. When I assumed office, the revenue GGR in 2022 was about P12.8 billion GGR. This year, we might hit about P100 billion,” Tengco said.

Tengco said many industry players operating in the gray market are coming forward to register.

He said Pagcor will continue to implement rationalized regulatory policies, monitor licensees compliance and strengthen partnerships with other government and law enforcement agencies to crack down against persistent illegal online gaming operators.

5 integrated casinos to open by ’28

By

Angela Celis

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September 11, 2024

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AFTER the recent opening of the Solaire Resort North casino complex in Quezon City, a new one is expected to open by 2028, this time it will be located south of Luzon.

Alejandro Tengco, chairman and chief executive officer of the Philippine Amusement and Gaming Corp. (Pagcor) said the upcoming Solaire Resort is one of the new five integrated resorts (IRs) expected to open within the term of the Marcos administration.

“Looking further into the future, we see more industry players investing in the Philippines, as they recognize the country’s unique selling point as a prime tourism and entertainment destination in this part of the world,” Tengco said in his speech at the Inside Asian Gaming Academy Summit yesterday at the Newport World Resorts.

“By 2025, another integrated resort casino will be launched in the Entertainment City area, as well as other potential projects in Cebu and Boracay by year 2026. Clark, the economic zone in Central Luzon is also on the radar for a new integrated resort in 2027, followed by another Solaire property resort sometime in the end of 2028,” he added.

The Westside City Project is set to begin operations first quarter of next year.

“While these expansions are expected to further increase our gross gaming revenues (GGR), they will also create a multiplier effect across various industries, providing more job opportunities, boosting tourism and encouraging more foreign investments,” Tengco said.

In his speech, Tengco highlighted the P82- billion industry GGR in the first quarter of 2024, which was close to 20 percent higher compared to year-on-year figures. In the second quarter, the industry GGR continued its upward trend and reached P90 billion, an increase of 32 percent from the same period last year.

“The sustained growth of the local gaming industry in the first half, brings us on track to hit our P335- billion industry GGR target,” Tengco said.

He estimates that the licensed casino sector, including those from the Entertainment City, Clark, Cebu and the Fiesta casinos in Rizal and Poro Point, will contribute as much as P257 billion to the GGRs in 2024.

“Moving on, we also expect the continuing phenomenal growth of the electronic games sector to boost the overall performance of the Philippine gaming industry in the coming years,” Tengco said.

In the second quarter of this year alone, the electronic games sector, which comprises the e-casinos, e-bingo, sports betting and specialty games, has already recorded a 525 percent revenue increase from the same period last year.

“By yearend, we project this sector will generate close to P100 billion in GGR, on its way to becoming the fastest-growing segment in Pagcor in the next few years,” Tengco said.

Govt fully awards Tbonds

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Angela Celis

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September 11, 2024

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THE Bureau of the Treasury (BTr) has fully awarded the reissued seven-year treasury bonds during yesterday’s auction amid healthy demand for the government IOUs.

In a statement, the BTr said the auction was 2.3 times oversubscribed with total tenders reaching P69.1 billion. With its decision, the BTr raised the full program of P30 billion.

This brings the total outstanding volume for the series to P219.7 billion. With a remaining term of four years and eight months, the reissued securities fetched an average rate of 6.058 percent.

This is lower than the 6.107 percent when it was last reissued.

Last Monday, the BTr upsized the amount it awarded for the auctioned treasury bills amid significant demand for the short-term securities.

The auction was 3.2 times oversubscribed, with total bids reaching P64.5 billion. This prompted the agency to double the accepted non-competitive bids for the 182-day securities.

With its decision, the BTr raised a total of P22.6 billion compared to the P20 billion initial offer.

BIR to monitor digital platforms, tenants on tax compliance

By

Angela Celis

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September 10, 2024

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The Bureau of Internal Revenue (BIR) will strictly monitor digital platforms as well as lessors of commercial spaces to ensure tax compliance of their respective online sellers, content creators or tenants.

“We will be monitoring digital platforms and e-marketplace platforms like Lazada, Shopee and Tiktok to check if their online sellers and content creators are compliant with BIR registration,” BIR commissioner Romeo Lumagui Jr. said in a statement yesterday.

“We will also monitor lessors and sub-lessors of commercial spaces like malls and buildings to check if their tenants are also compliant. Allowing lessees or online sellers/merchants to use to engage in business the premises or digital platform without BIR registration will be considered a violation of our tax laws,” Lumagui added.

The BIR recently issued Revenue Regulations No. 15-2024 (RR No. 15-2024) that prescribes the policies in relation to the registration of brick-and-mortar stores and online businesses.

The regulation will level the playing field between physical stores and online stores by regulating them equally, and taxing them uniformly.

Section 11 of RR No. 15-2024 provides that lessors, sub-lessors of commercial establishments/buildings/space and operators of digital platforms, including e-marketplace platforms, are required to ensure that all their lessees and online sellers or merchants are duly registered with the BIR.

Failure to enact or strictly enforce internal mechanisms or rules to prohibit the non-registration of these lessees or online sellers shall be considered by the BIR as an act of aiding or abetting in the commission of the offense.

The regulation also provides that business operations may be suspended through the issuance of a Closure/Take Down Order against physical or online businesses.

The closure of such business operations does not preclude the BIR from filing tax evasion cases under its Run After Tax Evaders program.

“We advise that e-marketplace platforms, online sellers and content creators should strictly follow RR No. 15-2024 as soon as possible. It is unfair to the retail industry or to sectors with brick-and-mortar stores, if online businesses are not regulated and taxed in the same manner,” Lumagui said.

“If physical stores can be closed down through a closure order, online businesses can be closed down through a takedown order,” he added.

Bangsamoro govt to acquire DBP shares in AAIIBP

By

Angela Celis

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September 10, 2024

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THE Bangsamoro Government is planning to acquire the Development Bank of the Philippines’ (DBP) shares in the Al-Amanah Islamic Investment Bank of the Philippines (AAIIBP).

This move, which is fully supported by the Department of Finance (DOF), is seen to promote financial inclusion and accelerate socio-economic development in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM).

In a statement, the DOF said that the proposed transfer of shares was approved by the Intergovernmental Fiscal Policy Board (IFPB) during its seventh meeting last September 3.

“Through this, we are taking bold steps to build a strong and vibrant Islamic banking system that caters to the specific needs of the people of BARMM. This will support the Bangsamoro government’s efforts to provide vital social and infrastructure projects to fast-track the region’s progress,” finance secretary Ralph Recto said yesterday.

Under the Bangsamoro Organic Law, the IFPB will determine the participation of the Bangsamoro Government in the AAIIBP.

The AAIIBP is the first Islamic bank in the Philippines. By its charter, it is recognized as a universal bank with an authorized capital stock of P1 billion consisting of 10 million common shares and a network of nine branches.

In 2008, the AIIBP became a subsidiary of DBP, owning 99.9 percent of its capital stock.

By owning the shares of the AAIIBP, the BARMM effectively saves on the total minimum capitalization required of around P6 billion in setting up a universal bank.

According to the DOF, the DBP supported the transfer of the shares to the Bangsamoro Government and assured the IFPB of the AAIIBP employees’ capacity to operate an Islamic bank.

To complete the transfer, the Bangsamoro Government and the DBP are now securing necessary approvals from the Bangsamoro Transition Authority – Parliament, the Bangko Sentral ng Pilipinas and the Governance Commission for GOCCs.

BTr awards P23B in Tbills auction

By

Angela Celis

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September 10, 2024

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THE Bureau of the Treasury (BTr) has once again upsized the amount it awarded for the auctioned treasury bills yesterday amid significant demand for the short-term IOUs.

According to the BTr’s statement, the auction was 3.2 times oversubscribed, with total bids reaching P64.5 billion.

This prompted the agency to double the accepted non-competitive bids for the 182-day securities.

With its decision, the BTr raised a total of P22.6 billion compared to the P20 billion initial offer.

This is the fourth consecutive week that the BTr has upsized the amount it awarded for the treasury bills.

The 91-, 182- and 364-day securities fetched average rates of 5.84 percent, 5.98 percent and 6.029 percent, respectively.

These are all lower than the previous auction and prevailing secondary market rates

The BTr is set to auction off seven-year treasury bonds for today’s auction.

It has a programmed volume of P30 billion.

Subsidies to GOCCs down 20% to P78B

By

Angela Celis

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September 9, 2024

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BTr building, Intramuros, Manila

The national government’s subsidies to government-owned and -controlled corporations in the first seven months of of 2024 fell by 19.61 percent year-on-year, data released by the Bureau of the Treasury (BTr) showed.

According to the latest cash operations report posted on the BTr’s website, subsidies in January to July totaled to P77.93 billion, down from the P96.93 billion recorded in the same period a year ago.

The lion’s share of the subsidies released to state-run firms, amounting to P43.29 billion, went to the National Irrigation Administration (NIA), which is responsible for irrigation development and management.

Meanwhile, aside from NIA, other billionaire recipients are the Power Sector Assets and Liabilities Management Corp. with P8 billion, National Housing Authority with P3.75 billion, National Food Authority with P2.25 billion and the Bases Conversion and Development Authority (BCDA) with P2.23 billion.

In July alone, government subsidies to state firms fell by 67.75 percent to P10.72 billion from the P33.24 billion a year ago.

NIA was the top recipient for the month, receiving P6.76 billion.

Meanwhile, the only other billionaire recipient aside from NIA is BCDA with P2.23 billion.

The BTr earlier reported that the national government’s budget deficit narrowed in the month of July due to the double-digit growth in revenues.

The budget deficit for July 2024 declined by 39.67 percent year-on-year to P28.8 billion, driven by faster revenue growth of 11.09 percent compared to the 5.8 percent increase in expenditures.

The resulting year-to-date budget gap stood at P642.8 billion, up by 7.21 percent from the same period last year.

The BTr data also showed that as of end-July, dividends remitted by state firms to the National Treasury totaled to P96.45 billion. The largest contributors are Land Bank of the Philippines with P32.12 billion, the Bangko Sentral ng Pilipinas with P13.23 billion and the Philippine Deposit Insurance Corp. with P10.68 billion. Meanwhile, the Philippine Ports Authority contributed P5.06 billion while the Philippine Amusement and Gaming Corp. remitted P4.6 billion.

German police kill suspect in exchange of fire near Israeli consulate in Munich

By

Angela Celis

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September 6, 2024

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By Anja Guder

MUNICH — German police shot dead a man in an exchange of fire near the Israeli consulate and a Nazi history museum in Munich on Thursday, state Interior Minister Joachim Herrmann said.

“Due to the intervention of the police, the perpetrator was stopped,” Herrmann told reporters. A police spokesperson in the Bavarian state capital said the man had a “long-barrelled gun” that proved to be an old rifle.

The gunman shot has been identified as an 18-year-old Austrian national believed to be a resident in Austria, a spokesperson for police in the southern German city told reporters.

The suspect’s motive is under investigation, the spokesperson added.

The incident occurred on the anniversary of the 1972 attack at the Munich Olympics in which Palestinian militants murdered 11 Israeli athletes. The motive of the gunman in Thursday’s incident was not immediately known, but Herrmann said police would try to clarify whether it had any link to the anniversary.

The suspect had recently travelled to Germany and lived in Austria’s Salzburg area near the border with Bavaria, the Standard newspaper and Spiegel news outlet reported.

He is said to have been known to security authorities as an Islamist, they added.

Police in Munich declined to comment on the report and said they were not currently sharing information about the suspect.

The Israeli foreign ministry said the consulate was closed on Thursday for a commemoration of that massacre and no one from the consulate staff was injured in the incident.

The museum and research institute, which focuses on the history of Germany’s 1933-45 Nazi regime, is located near the Israeli consulate in Munich’s Maxvorstadt neighborhood.

German Interior Minister Nancy Faeser described the exchange of fire as a serious incident. “The protection of Israeli facilities has top priority,” she said.

The shooting comes at a time of heightened polarisation in Germany’s political climate. On Sunday, the anti-immigrant Alternative for Germany (AfD) became the first far-right party to win a regional election since World War Two.

Israeli President Isaac Herzog said he had spoken to his German counterpart.

“We expressed our shared condemnation and horror at the terror attack this morning,” Herzog posted on X, adding that on the day of remembrance for the Olympics massacre, “a hate-fueled terrorist came and once again sought to murder innocent people.” – Reuters

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