Philippine Digital Gaming Overtakes Physical Casinos Following POGO Ban and Tax Reforms

For the first time in the history of the Philippine gaming industry, digital platforms have outpaced traditional brick-and-mortar casinos. Following a nationwide ban on offshore operators and aggressive domestic tax reforms, the online gaming sector claimed the majority share of the country’s record-breaking gross gaming revenue (GGR) in 2025. This milestone marks a structural realignment in one of Asia’s most prominent gaming markets, driven by evolving consumer behaviour and a decisive government pivot toward a highly regulated, tech-driven ecosystem.

Data published by the Philippine Amusement and Gaming Corporation (PAGCOR) reveals that the broader industry generated a record ₱396.14 billion in GGR in 2025, representing a 6.39% increase from the ₱372.33 billion recorded in 2024. The electronic and online gaming segment – which encompasses e-games, e-bingo, and digital poker – surged to ₱201.12 billion. This segment now accounts for 50.77% of the total industry output.

Conversely, traditional land-based operations experienced a notable downturn. Privately operated licensed casinos generated ₱182.50 billion, a 9.58% year-on-year decline, while PAGCOR-operated Casino Filipino venues dropped 20.95% to ₱12.52 billion.

The market shift was catalyzed by two major regulatory interventions. The first was President Ferdinand Marcos Jr.’s sweeping ban on Philippine Offshore Gaming Operators (POGOs) over national security and social concerns, which legally dismantled the offshore-facing sector. The second was PAGCOR’s strategic reduction of the e-games tax rate, which was slashed from over 50% in 2023 down to 30% by early 2025. These combined measures effectively removed grey-market distortions, encouraging capital to flow into local, regulated digital channels.

“The E-Games and online gaming segment accounted for 50.77% of total industry GGR. It has overtaken licensed casinos as the largest GGR contributor,” stated PAGCOR Chairman and CEO Alejandro H. Tengco. “Online gaming is no longer a supplementary segment but has now become the leading driver of overall GGR growth.”

Addressing the simultaneous contraction in physical gaming venues, Tengco noted that the decline in land-based casino revenue is “largely driven by the gradual change in player behavior, with more customers opting for digital and online gaming platforms.”

Industry stakeholders view this transition as a positive maturation for the regional market. Ellen Joy Almanza, a managing consultant at domestic operator Buenas PH, remarked, “The industry’s growth signals a mature, structural evolution. It proves that a compliance-first, highly regulated digital gaming landscape creates sustainable, high-value tech and corporate career paths.”

While the rapid expansion of the digital sector has successfully offset the financial void left by the exit of offshore operators, the transition presents a nuanced picture. The state regulator continues to grapple with the proliferation of unlicensed overseas platforms attempting to target domestic players.