According to some Macau Junkets, the Macau government has reintroduced a 5% commission tax payable by all junkets on commissions earnt each month.
Under the recently passed law on junkets, titled Legal Framework for Operating Games of Chance in Casinos, junkets are entitled to receive a 1.25% commission on rolling chip turnover, which is paid to them by their concessionaire partner. The law also notes that junkets are required to pay a 5% tax on their commissions, to be paid to the government on a monthly basis.
While this tax was already in place long before the new law was passed late last year, it had previously been waived. Kwok Chi Chung – President of the Macau Association of Gaming and Entertainment Promoters – told IAG that the government is now demanding payment of the tax.
“The tax has always existed but the previous Chief Executive had granted a waiver of the tax and now the government is reintroducing it,” Kwok said.
“The tax has definitely had an impact on the revenue of junkets and will reduce their income, but it is not a new tax. There are many taxes that have been exempted in Macau in the past, such as the tourism tax.”
However, Kwok also noted that junket income had risen significantly in January in a positive sign for the industry. The Gaming Inspection and Coordination Bureau this week revealed market-wide GGR had reached MOP$11.58 billion (US$1.43 billion) for the month – the highest in three years.
“Junkets are engaged in a business governed by the new Gaming Law and the industry is adapting to the operation mode under this new law, but all in all there was good business in January,” he said.
“The MOP$11.58 billion in gaming revenue also exceeded estimates, indicating that Hong Kong’s customer base is making a significant contribution to gambling revenue. Junkets saw a significant increase in rolling chip turnover in January, with both mass and premium mass customers increasing significantly.
“However, with fewer days in February and a drop in mainland visitors after the Chinese New Year holidays, gambling revenue will definitely be lower in February than in January.”
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