While Southeast Asian countries continue to ignore Asia’s ranking as the second largest gambling market, gambling remains illegal in their jurisdictions.

Being frontrunners in technological advancements, Southeast Asian countries like Singapore, Malaysia, Thailand and Indonesia can easily hurdle the technical challenges of regulating online gambling. Yet political will seems to be the primary factor that keeps these countries opposed to the legalization of gambling.

Can the Philippines Depict the Best Example of a Sustainable Online Gambling Industry

The Philippines can be cited as the best example of how online gambling helped a country alleviate economic stresses caused by the COVID-19 pandemic. Yet the country still lacks the political will in making the online gambling industry a truly sustainable source of revenue for the Philippine government.

Prior to the pandemic, lawmakers passed tax reforms that more than doubled the tax imposed on offshore online gambling operators — from a previous 2% to the present 5%. Moreover, the reform also modified the tax base, from the previous gambling receipts net of customers’ winnings, to the straightforward gross gambling receipts regardless if portions thereof were actually paid out to winning players.

As a result, there is an ongoing exodus of offshore online gambling operators who have cancelled their accreditations. The cancellations starkly reduced the projected tax revenues that the country expects to collect at the end of year 2020.

Moreover, the Philippine government’s approach in adopting online gambling as an industry is ambivalent. Philippine Offshore Online Gambling Operators or POGOs as they are commonly known in the country, operate only as legal gambling businesses that can deploy their online casino games and sportsbook in neighboring foreign countries.

They are actually the operators of the Judi Online casino and betting sites patronized by Southeast Asian gamblers. However, POGOs are forbidden to give Filipino players access to their remote gaming websites, whether residing within the country or abroad. Mainly because online gambling is likewise illegal in the Philippines.

Moreover, POGO operations if allowed in the country will compete with the high-end, land-based casinos. That would be to the detriment of several major international hotel and resort companies who invested billions; convinced that the Philippines will be the next gambling Mecca for junket tours catering to wealthy Asian gamblers.

While junket tours are generally regarded as legal, Philippine lawmakers have held Congressional hearings because they were not aware of how junket tours work and how they can be prevented from becoming part of money laundering operations. Since revenue generation was the more important issue, the Congressional inquiry about junket tours all too soon quickly died.

The Philippine government continues to keep cordial alliance with the governments of neighboring countries due to economic ties. Yet the Philippines’ online gambling industry still remains vulnerable if Southeast governments persist in adopting measures that will prevent POGOs from accessing their communication networks, be they publicly or privately operated.

At worst, said governments may even consider imposing sanctions that could result in economic loss that is much greater than the economic benefits gained by the Philippine government.