The Macau government has no plan, for now, to adjust the commission rate for VIP junkets, currently capped at 1.25 percent for rolling chip turnover, said on Tuesday veteran legislator Chan Chak Mo, citing consultation with officials, after a closed-door meeting.
Mr Chan heads a committee scrutinising the draft bill on the city’s gaming law amendment.
In a briefing for the media after the meeting, Mr Chan said some legislators present at the meeting asked whether the government could raise the commission rate limit for junket play.
This was because the draft bill – as currently worded – says Macau junkets, referred by the authorities as “gaming promoters”, are only allowed to earn commissions for their gaming promotion work.
Under the draft law, junkets would also be forbidden to share casino revenue, in any form or via any agreement, with any gaming concessionaire partner. In recent years, some junkets had operated either a revenue share or profit share model with casino partners, rather than receiving a rolling chip commission payment.
Mr Chan noted in his Tuesday remarks: “Apart from earning commission for their work, junkets cannot earn any other forms of income, such as revenue split” with a casino concessionaire, “or bonuses.”
He added some legislators had questioned whether that would “lower” junkets’ “competitiveness,” relative to rival casino jurisdictions in the region.
But Mr Chan said: “The government explained in response that our gaming [revenue] tax rate is quite high globally – considering that it stands at approximately 40 percent – plus the [cap at] 1.25 percent” commission rate applicable to junket play.
He added: “The casinos are left with nothing much. So the government sees no condition to change” the junket commission rate.
The draft bill contains a broad regulatory framework for the city’s licensed junkets. The document specifies that junkets will be forbidden to contract use of any part of a casino for operations in their own right.
Specifics on the operation and licensing requirements for junkets would be formed via a separate law, which is being drafted by the government, Mr Chan told press last week. He noted at the time that the Legislative Assembly has aimed to approve this new junket law by mid-August.
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Philippine Amusement and Gaming Corp