SC blocks higher POGO taxes under Bayanihan 2

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Metro Manila (CNN Philippines, January 5) — The Supreme Court has issued a temporary restraining order against the collection of higher taxes from the Philippine offshore gaming operators or POGOs under the Bayanihan to Recover as One Act.

Chief Justice Diosdado Peralta confirmed the Supreme Court’s decision on Tuesday, with the magistrates voting 13-1. Only Associate Justice Marvic Leonen dissented.

The 5% franchise tax on POGOs’ gross bets or pre-determined minimum monthly revenues, whichever is higher, is identified as a major funding source under the Bayanihan to Recover as One Act, also known as Bayanihan 2.

The law allots a ₱165.5-billion fund for pandemic response and recovery. Senate Minority Leader Franklin Drilon earlier said this would include an estimated ₱17.5 billion the government could expect from POGO tax collections.

Although the law expired in December, a bill extending its validity is just awaiting President Rodrigo Duterte’s signature. Economic managers earlier said an extended Bayanihan 2 and 2020 budget will spur the recovery of the Philippine economy next year, along with the ₱4.5-trillion national spending plan for 2021, which includes funds for the purchase of COVID-19 vaccines and subsidies for ailing industries.

The Supreme Court has yet to release its ruling but a highly placed source said most of the justices saw the provision on POGOs as a rider. Leonen for his part, said Bayanihan 2 was an urgent piece of legislation that should be granted the presumption of constitutionality amid the coronavirus crisis, the source said.

CNN Philippines' Anjo Alimario contributed to this report.