DOF Continues Review of Online Gaming Tax and De Minimis Policy Changes

 

The Department of Finance (DOF) is continuing to evaluate two potential tax policy changes involving online gambling platforms and low-value imported goods, although neither proposal has reached the stage of formal implementation.

One measure under consideration is an excise tax on online gaming activities, an initiative intended to strengthen government oversight of digital gambling while potentially generating additional revenue.

Finance Undersecretary Karlo Adriano confirmed that the department remains engaged in discussions on the proposed levy, which was originally raised by Executive Secretary Ralph Recto when he was still serving as finance chief.

Adriano said the proposal remains under assessment and would require the approval of Finance Secretary Frederick Go before it could be submitted to President Ferdinand Marcos Jr. for consideration.

The proposal emerged in July 2025, when the rapid expansion of online gambling triggered calls from lawmakers and other sectors for a nationwide prohibition of digital betting platforms.

Recto favored exploring stricter regulatory measures rather than immediately imposing a blanket ban. An excise tax was among the options considered as part of efforts to address the growing accessibility of online gambling.

Data from the Philippine Amusement and Gaming Corp. (PAGCOR) indicate that approximately 10 million Filipino adults actively participate in legal online gaming platforms, highlighting the scale of the industry and the potential reach of any regulatory changes.

DOF Examines Possible Changes to Import Tax Exemptions

The finance department is also reviewing the country's de minimis tax exemption, which currently allows imported goods valued below P10,000 to enter the Philippines without paying applicable taxes and duties.

Adriano described the existing arrangement as a considerable source of potential government revenue losses, particularly because it may create an uneven competitive environment for domestic manufacturers and retailers.

The Bureau of Customs has previously raised concerns about businesses allegedly exploiting the exemption by declaring shipment values below the P10,000 threshold, even when the actual value of their imported products exceeds the limit.

According to Adriano, addressing the issue is partly a matter of ensuring fair competition between foreign online sellers and Philippine-based businesses.

However, the DOF acknowledged that changing the existing policy may not be immediately feasible given current economic conditions. Any substantial revision would also require legislative action.

The two proposals reflect the department's continuing review of tax policies affected by the expansion of digital commerce and online services. While an online gaming levy could introduce another source of government revenue, revisiting the de minimis exemption could help address tax disparities between imported products and locally manufactured goods.

For now, both initiatives remain under study, with further action dependent on executive approval and the legislative process.