The Philippines’ Bureau of Internal Revenue (BIR) has issued a directive confirming that jackpot prizes should be subject to a 20% withholding tax.
The BIR said it provided the clarification after receiving numerous inquiries about the scope of the term ‘winnings’ under the country’s tax code, according to reporting by the Philippine News Agency.
Under the tax code, both fixed and progressive jackpots fall within the definition of ‘winnings’, meaning that operators are required to withhold 20% of the prize before service charges and administrative fees are deducted.
This figure rises to 25% for non-residents who are ‘not engaged in trade or business’ within the Philippines.
The BIR noted that the performance of the Philippines’ gambling industry has led to the availability of more high-value jackpot prizes for players.
The approach of the Philippines is setting it on a different path from the vast majority of the other Asian markets.
Macau, Singapore and Japan are all tax-free when it comes to wagers, instead choosing to place the burden on the operator.
India is one of the few other markets in the region where there is still a tax on player wagers, which includes jackpots.
The move also opens up a risk of fraud when it comes to ‘advance tax scams’ that have been seen in the country.
However, the economic impact could be significant for the country, as the sector continues to grow, with data from the Philippine Amusement and Gaming Corporation (PAGCOR) detailing that revenue from the country’s gaming sector increased over 6% to P396.1bn (£4.87bn) in 2025, driven primarily by a 30% increase in the electronic gaming sector.
“In view of these developments, there is a compelling need to clarify the tax treatment of jackpot prizes to ensure consistent application of existing laws, promote equity and uniformity in taxation, and safeguard government revenue, without expanding or modifying the scope of the law,” said the BIR.
PAGCOR ramps up player protection
In recognition of this growth, which was somewhat tempered in the first quarter of 2026 due to the impact of tensions in the Middle East, PAGCOR has looked to introduce new regulations to protect the market.
Among these changes are mandatory accreditation for B2B suppliers, restrictions on where and when gambling companies can advertise, and limits on cashback offers and cash rebates tied to player losses and turnover, respectively.
More recently, the regulator has also unveiled a new 24-hour problem gambling helpline for players in partnership with the Seagull Flock Organisation.
Users of the service will have access to trained counsellors who will provide support for problem gambling and referrals for further treatment.
PAGCOR’s Chair and Chief Executive Officer, Alejandro Tengco, said the helpline, which will be operated by 12 counsellors to begin with, reflects the regulator’s commitment to responsible gambling.
He said: ‘’PAGCOR is aware that for many, gaming is just a form of leisure and recreation. But for some, what may start as entertainment can gradually lead to financial strain and ruin, emotional distress, damaged relationships, and isolation.”
The move mirrors similar services available in markets such as the UK, through the National Gambling Helpline run by GamCare, and the National Problem Gambling Helpline Network in the US.
