GGRAsia – Pricier casino permits again if Pagcor venues sold: report

Pricier casino permits again if Pagcor venues sold: report

Aug 31, 2016 Newsdesk Latest News, Philippines, Top of the deck

A senior Philippine government official has been reported saying that the return of higher licence fees for private sector casinos in the country would offset the loss of public revenue, were state-owned casinos sold off.

The Manila Bulletin newspaper in a Tuesday report attributed the comment to Finance Secretary Carlos Dominguez, but didn’t quote him verbatim.

Casinos directly operated by the country’s casino regulator-cum-operator, the Philippine Amusement and Gaming Corp – also known as Pagcor – recorded gross gaming revenue of PHP15.80 billion (US$340.7 million) in the six months to June 30, according to official data. Private sector casinos had GGR of PHP49.75 billion in the same period.

According to the regulator’s website, under Pagcor’s charter and relevant national laws, 5 percent of Pagcor’s “winnings” goes to the Bureau of Internal Revenue as franchise tax; while 50 percent of the 95 percent balance “goes to the national treasury as the national government’s mandated income share”.

In 2014, Pagcor temporarily reduced the licence fees that private sector casino operators had to pay to the regulatory body, by a factor of 10 percent. But Pagcor has recently ordered the respective operators of four private sector casinos in Manila – three in Entertainment City and one at Newport City next door to Manila International Airport – immediately to restore to its original rate the licence fee payable, separately reported this week the Manila Bulletin.

Meanwhile, Mr Dominguez was directly quoted in Tuesday’s report as saying the government is “seriously” considering privatising the operations of Pagcor’s directly managed casinos. He had flagged such a sell-off a week earlier.

“We had a discussion and I suggested that Pagcor should limit itself in the regulatory functions and should privatise their [sic] casino operations, because quite frankly it is very difficult for them to outplay the [privately-owned] casinos,” Mr Dominguez reportedly told the media on the sidelines of a government committee meeting on Tuesday.

The Manila Bulletin additionally reported Pagcor’s head, Andrea Domingo, as saying the regulator did not yet have any estimates regarding what revenues could be produced by privatisation.

“I suppose the DOF [Department of Finance] will have hire independent appraisers,” Ms Domingo was quoted as saying, adding, “it’s improper, even dangerous, to give out haphazardly computed estimates.”

The news outlet said Senator Ralph Recto had mentioned a figure of PHP200 billion could be realised from the sale of Pagcor casinos.

The news report did not clarify how many of Pagcor’s own casinos – which carry the branding ‘Casino Filipino’ – might be put up for offer. The media outlet suggested no offers to buy were currently on the table.

In August 2010 – during the administration of President Benigno Aquino – the boss of San Miguel Corp, one of the Philippines’ biggest conglomerates, expressed an interest in buying Pagcor for US$10 billion. In the end the idea did not move forward.

In December 2015 during the closing months of Mr Aquino’s presidency, a government commission had recommended the privatisation of Pagcor’s casino operation function, so that it could focus instead on regulating them.