GGRAsia – Macau govt surplus to May despite gaming tax dip

Macau govt surplus to May despite gaming tax dip

Jun 08, 2020 Newsdesk Latest News, Macau, Top of the deck

The Macau government has collected nearly MOP21.04 billion (US$2.64 billion) in tax revenue from the city’s gaming industry in the first five months of this year. The figure is down 56.5 percent compared to the prior-year period, showed official data published on Friday by the city’s Financial Services Bureau.

The data show the government collected about MOP500 million in tax from the city’s casino industry in April. In a revised budget for 2020, the government had forecast it would gather at least MOP4.16 billion in gaming tax on a monthly basis.

The figures published on Friday showed the tax sum collected so far this year from the gaming sector was 42.1 percent of the amount the government had budgeted for the whole year, according to its revised budget. The government is now forecasting it will collect nearly MOP49.98 billion in such tax in full-year 2020.

Macau casino gross gaming revenue (GGR) declined by 93.2 percent in May in year-on-year terms, to just above MOP1.76 billion, according to official data. Aggregate Macau casino GGR for the five months to May 31 stood at approximately MOP33.0 billion, a contraction of 73.7 percent year-on-year, showed official data.

The latest official data also indicated that revenue from gaming collected so far in 2020 accounted for about 83.4 percent of the slightly above MOP25.22 billion the government collected from all sources. Despite the decline in gaming taxes, the government has recorded a surplus of MOP8.23 billion up to May 31. That was down 74.3 percent from the prior-year period.

The Macau government is expecting a MOP38.95-billion deficit for full-year 2020, due to measures to support the economy amid the Covid-19 pandemic.

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.