The Macau government has collected just above MOP17.23 billion (US$2.15 billion) in tax revenue from the city’s gaming industry in the first two months of this year. The figure is down 12.2 percent compared to the prior-year period, showed official data published on Monday.
Aggregate Macau casino gross gaming revenue (GGR) for January and February stood at approximately MOP25.23 billion, a contraction of 49.9 percent year-on-year, showed official data. Macau casino GGR declined by 87.8 percent in February alone, coinciding with the government’s decision that the city’s casinos would have to close for a 15-day period from February 5.
The government taxes the GGR of Macau casinos at a rate of 35 percent, but other levies on the casino gaming gross raise the tax rate to 39 percent in effect. Other taxes on the Macau gambling sector include levies on the income of Chinese traditional lotteries, on horse racing, instant lotteries and tax on commissions earned by operators of gambling junkets.
The tax-take figures in a given calendar period and the city’s casino GGR in such a time frame are not directly comparable for a number of reasons. They include the fact that there is typically a delay between the point where GGR is recorded in Macau casino operations, and the point at which tax is registered by the Macau government as having been paid on such play.
The government’s Financial Services Bureau releases the tax data to indicate the general health of the city’s coffers. The figures published on Monday showed the tax sum collected so far this year from the gaming industry was 17.5 percent of the amount the government had budgeted for the whole year. The government had forecast it would collect nearly MOP98.22 billion in such tax in full-year 2020.
The latest official data also indicated that revenue from gaming collected so far in 2020 accounted for about 92.0 percent of the nearly MOP18.74 billion the government collected from all sources.
The authorities had budgeted for a fiscal surplus of just below MOP20.79 billion for the whole of 2020. At the end of February, the government surplus was nearly MOP11.84 billion, down 30.3 percent from the prior-year period, official figures indicate.
Macau’s Secretary for Economy and Finance, Lei Wai Nong, said in a press briefing last week that the government was now expecting a budget deficit of over MOP40 billion in 2020, as a result of the negative impact of the Covid-19 disease on the local economy.
The official said additionally that the government had no plans to give the local casino industry some tax breaks amid the uncertainties over the Covid-19 virus alert.
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”Our own consensus is that any newcomers to this [junket] sector should be corporatised, and should be financially sound and able to commit a higher guarantee deposit”
Kwok Chi Chung
President of junket trade body, the Macau Association of Gaming and Entertainment Promoters