GGRAsia – Macau govt gaming tax income down 35 pct as of May

Macau govt gaming tax income down 35 pct as of May

Jun 16, 2015 Newsdesk Latest News, Macau, Top of the deck

The Macau government collected a total of MOP38.45 billion (US$4.82 billion) in direct taxes from gaming in the first five months of 2015, down by 35.4 percent year-on-year, according to data disclosed on Monday by the city’s Financial Services Bureau.

Accumulated direct tax from gaming has been declining as casino gross gaming revenue (GGR) in Macau has fallen for 12 consecutive months when judged year-on-year. Aggregate GGR for the first five months of 2015 stands 37.1 percent lower than in the same period in 2014.

Direct taxes from gaming brought in 82.8 percent of the Macau government’s total revenue in the five months to May 31.

Government data show a 33.8 percent year-on-year decrease in government revenue for the January-May period. The total revenue for the period was MOP46.42 billion, about MOP23.74 billion lower than total government revenue in the year-prior period.

Due to the decline in government revenue at a time when expenditure has actually been increasing, the Macau government surplus is down by 54.9 percent year-on-year in the first five months of 2015 to MOP25.28 billion. The surplus amount however is currently above the government’s forecast for the full year, at MOP18.81 billion – the forecast was revised last month in an amended budget approved by the territory’s Legislative Assembly.

The government’s new budget is based on an estimate that average gross monthly gaming revenue will be MOP20 billion this year, down from an earlier estimate of MOP27.5 billion.

Japanese brokerage Nomura said in a note last week that it would be considered a “warning” to the Macau gaming industry if monthly casino revenue in the city dips much below MOP18 billion. Macau’s Secretary for Economy and Finance Lionel Leong Vai Tac said in April that if monthly GGR goes below MOP18 billion, then the government would need to consider public spending cuts.