The operations of casino junkets, including if and how they would be taxed under the nation’s new casino regulatory regime, has been discussed at length by Sri Lanka’s Committee on Public Finance.
According to mainstream media outlet The Sunday Times, the committee’s discussions come amid some uncertainty around the new Gambling Regulatory Authority’s (GRA) responsibilities and specifically whether it would oversee finances, junket operations, credit or money transactions, and more specifically whether it will have responsibility for some or all of those risk areas.
A draft bill that would establish the GRA as the official regulator for the Sri Lankan gaming industry was gazetted late last month. The Gambling Regulatory Authority Act will now be tabled in parliament with the goal of establishing the regulator as an independent body with a broad and comprehensive mandate.
However, in addressing the Committee on Public Finance last week, a representative of the Central Bank of Sri Lanka suggested that the tax net proposed under the GRA may not capture junkets.
“The inland revenue mechanism, casinos are already under their revenue collection structures, but of course going forward, whether the junket operators will be included in that revenue mechanism is yet to be seen,” the official is quoted as saying by The Sunday Times.
However, “once the regulatory authority is established it is very much within their purview to issue regulations and necessary directives,” they added.
The media outlet notes that junkets are not specifically mentioned under the GRA bill, suggesting the bill in its current form contains significant loopholes that must be addressed.
The Central Bank of Sri Lanka representative reportedly told the committee that junkets currently face no regulation under Sri Lanka’s existing laws but this would likely change once full details of the GRA’s remit were established.
“Once the Gambling Regulatory Authority comes there is … a way to monitor this operation,” they said. “At the moment, there is no mechanism to monitor. The only mechanism that [is] established is within the fiscal policy department of the Ministry of Finance [which is] also for licensing purposes. There is no provision to enforce it even under the current [Casino Business (Regulation) Act, No. 17 of 2010].
