Inside Asian Gaming

INSIDE ASIAN GAMING | January 2012 22 debate by calling on the government to open casino dealing jobs to non-locals. This, said the legislator, was in order to help locals escape the glass ceiling of a well-paid job on leaving school that then offers little career progression. The reply of Macau’s Chief Executive Chui Sai On was not encouraging. He was quoted as saying such a policy would “not happen on my watch”. It seems that in the minds of the local leaders, fear of social unrest through too much change too quickly—and possible rebuke from head office in Beijing; as befell Macau’s first CE, Edmund Ho—trumps innovation and energy in social and economic policy. From a political standpoint, there is a powerful argument for keeping Macau’s tax base small. Working on the well-tried principle expounded during America’s Revolutionary War against Britain—‘No taxation without representation’—the danger of adding more people to the taxable classes is that they may well start to clamour for more say in how their city is run. That could mean one-person-one- vote. There’s nothing in Macau’s Basic Law agreed between Portugal and China prior to the 1999 handover (unlike the Basic Law in Hong Kong) that explicitly lists universal suffrage as a political aspiration. Now for the number crunching on the income tax base in Macau. There were 345,000 people registered as working in the September to November 2011 period, according to data published by the territory’s Statistics and Census Service (known as DSEC, by its Portuguese initials). According to a guidance note issued by financial services company PricewaterhouseCoopers (PwC) in June last year, the threshold for paying personal income tax in Macau on personal income earned during 2011 was MOP144,000 (US$18,000). In Hong Kong during the same period, the non-taxable personal allowance for a single person without dependents (the threshold above which income tax is charged on employees as opposed to self-employed people) was HK$108,000 (US$13,900), according to information from Hong Kong’s Inland Revenue Department. The Hong Kong government has to rely on income tax more heavily than Macau, but Hong Kong does use land sales to balance or boost its budget. In 2010-11, Hong Kong’s consolidated budget surplus was estimated at HK$60 billion (US$7.73 billion), according to PwC. In Macau, a person would need to be earning a minimum of MOP12,000 gross per month to qualify for payment of personal income tax. In Hong Kong, a single person with no dependents only needs to be earning HK$9,000 gross per month. In the third quarter of 2011 in Macau, only four groups of workers out of nine occupation groups listed had median monthly wages (excluding overtime and bonuses) at or above the MOP12,000 level (see Table 1 below). They were legislators and civil servants, professionals, technicians and clerks (the latter group including casino dealers). Confusingly, DSECdispenseswiththosecategorieswhen analysing raw numbers in employment and uses only broadly approximate ones Macau Policy Annual gripe—Macau workers take to the streets to air their grievances during Labour Day on 1st May, 2011 Legislators, senior officials, company directors and managers (MOP) Professionals (MOP) Technicians and associate professionals (MOP) Clerks (MOP) Services and sales workers (MOP) Skilled agricultural and fishery workers (MOP) Craftsmen and similar workers (MOP) Plant and machine operators, drivers and assemblers (MOP) Unskilled workers (MOP) 2010 Qtr 1 25,000 20,000 15,000 12,000 7,000 6,000 9,000 8,000 4,500 Qtr 2 20,000 20,000 15,000 12,000 7,000 7,000 9,000 8,000 4,500 Qtr 3 20,000 20,000 15,300 12,400 7,000 7,100 10,000 8,000 4,500 Qtr 4 23,000 25,000 15,000 12,300 7,000 8,000 10,000 8,000 4,500 2011 Qtr 1 27,000 25,000 15,000 13,000 7,400 8,900 10,000 8,300 5,000 Qtr 2 28,000 22,000 16,000 13,000 8,000 8,000 10,000 9,000 5,000 Qtr 3 30,000 24,000 15,300 13,000 8,000 7,100 10,000 9,300 4,600 Source: DSEC, Macau Table 1. Macau median monthly income by occupation 2010-2011