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In a bid to encourage licensed operators and curb the growing illegal gaming market, the Philippine Amusement and Gaming Corporation (PAGCOR) has announced a further reduction in the country’s gaming rates. Operators will now pay 30% of gross gaming revenues (GGR) instead of the previous 35%.
The regulator revealed this in a press release published yesterday (Jan. 20), with the chairman hoping that the move will create a more favorable regulatory environment. PAGCOR had previously reduced the rate from 40% in April 2024, reflecting its ongoing efforts to enhance the competitiveness of the legal gaming sector.
“By lowering our share rates, PAGCOR is creating a more favorable regulatory environment by encouraging unregistered online gaming operators to transition to the legal market,” PAGCOR Chairman and CEO Alejandro H. Tengco said.
Furthermore, online gambling operators are not the only ones to see their rates reduced. Integrated resorts will now have to pay only 25% of their gross gaming revenues, with Tengo stating the reduction is designed to help offset the significant overhead expenses that land-based operators face.
Positive Trends Followed Past Reductions
Before the rate reductions began in 2023, operators were facing fees exceeding 50% of their GCR, a situation that significantly hindered their ability to expand, according to the regulator.
However, since the current leadership initiated these rate cuts, there has been a noticeable increase in the number of licensed operators entering the market. Many of these new entrants were previously operating illegally but have now opted to transition to the regulated space, recognizing that compliance offers not only safety from legal repercussions but also a more stable business environment.
Since it began operations, PAGCOR has issued 1,188 licenses for various on-site and online gaming offerings, reflecting a 13.57% increase from the 1,046 licenses granted in 2023. Also, the number of accredited gaming service providers has increased fivefold from 49 in 2023 to 174 in 2024.
This switch has also been reflected in the country’s gaming revenue. According to Tengco, the E-games sector surpassed its Php100 billion GGR target for the entire 2024 by September.
“The gradual reduction of share rates has significantly contributed to the growth of the E-Games sector, which has become a key driver of the local gaming industry,” he said.
“We expect this trend to continue. We are optimistic that the best is yet to come for the country’s egames sector.”
Crackdown on Offshore Sites Continue
While the Philippine Amusement and Gaming Corporation has been making moves to attract operators to the licensed market, the Philippines House of Representatives has been working hard to crack down on offshore gaming sites.
Four new bills aimed at tightening regulations were introduced toward the end of last year, reflecting a clear commitment to enhancing oversight in the gaming industry. Concurrently, President Ferdinand R. Marcos Jr’s total ban on Philippine Offshore Gaming Operators(POGO) took effect on December 31st, with the government hoping to purge the sector of illegal and offshore sites by the of 2025.
Source: iGamingBusiness
