The Cambodian government saw the amount of tax collected from the nation’s 193 licensed casinos fall by more than half in 2020, impacted by widespread closures and reduced international visitor arrivals due to COVID-19.
Deputy Director of the Ministry of Economy and Finance, Ros Phearun, told The Phnom Penh Post that tax revenue dropped from around US$85 million in 2019 to US$40 million in 2020.
“As we’re all too well aware, the COVID-19 epidemic began in late 2019 and persists to this day,” he said. “It has pulverized all economic sectors, and the casino industry has sustained a crippling blow as well.
“Practically all of our casinos ceased operation in 2020, with only just seven or eight left scrambling to keep their businesses afloat. That’s why our revenue collection has dropped so much.”
Casinos across the country were closed upon order of Prime Minister Hun Sen on 2 April 2020, only reopening their doors from August and some as late as October. Tax revenues were also impacted by a nationwide ban on online gambling operations, which saw all previous online licenses expire as of 1 January 2020.
However, with Cambodia having passed its long-awaited Law on the Management of Integrated Resorts and Commercial Gambling (LMCG) in November – which includes a flat tax on gross gaming revenues of 4% for VIP and 7% for mass – Phearun said it is expected revenues will rebound in 2021.
“We expect tax collection from our casino industry to improve in 2021 thanks to our compliance with the recently-passed law,” he said.
“We’ll collect [taxes] in a transparent way, but as COVID-19 continues to spread and slash tourist arrivals, we dare not predict what the revenue from this sector will be.”
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