GGRAsia – Macau to revise 2021 casino revenue forecast: Secretary

Macau to revise 2021 casino revenue forecast: Secretary

Sep 09, 2021 Newsdesk Latest News, Macau, Top of the deck

The Macau government will “definitely” adjust its full-year forecast for casino gross gaming revenue (GGR) in the light of recent events, said on Wednesday Lei Wai Nong (pictured in a file photo), the city’s Secretary for Economy and Finance, in comments to local media.

The Secretary added the revised estimate was still being calculated, and would be included in the city’s revised budget to be submitted to the Legislative Assembly later this year. He also noted the government hoped for improvement in Macau’s GGR over the course of the next two months.

Macau’s August casino revenue had been “negatively affected” by local Covid-19 cases that month, said Mr Lei.

He also mentioned that Macau had recorded 24,000 visitor arrivals on Tuesday, versus an average daily tally of 21,000 for the first half of this year. The market saw a dip in visitor volume in early August, coinciding with the local Covid-19 alert.

In July, the government had said it was sticking to its 2021 GGR f orecast of MOP130 billion (US$16.2 million), a figure nonetheless 44 percent of 2019 levels, acknowledging that the recovery from the pandemic would “take time”. August GGR declined 47 percent month-on-month, coinciding with increased restrictions on inbound travel.

This week Fitch Ratings Inc said it expected Macau’s casino GGR for 2021 to be “nearly 65 percent below 2019 levels,” before the onset of the health crisis. According to the ratings agency, that would be about MOP102.4 billion this year, compared to MOP292.4 billion in full-year 2019.

The Secretary’s Wednesday comments came as the city’s Financial Services Bureau disclosed that day, that Macau collected approximately MOP2.56 billion in tax revenue from the gaming industry in July this year.

The July gaming tax take was nonetheless down 36.3 percent from the previous month, when Macau recorded just above MOP4.01 billion in gaming tax. Judged year-on-year, the July gaming tax take was up by 536 percent, although the year-on-year comparison was distorted by the severe decline in visitor numbers to Macau associated with the Covid-19 pandemic.

For the first seven months of this year, the Macau government has collected just above MOP22.2 billion in gaming tax, representing just a slight increase of 0.04 percent when compared with the same period last year.

Nonetheless, with July’s gaming tax take, the Macau government achieved 44.4 percent of the MOP50.01-billion that it had estimated to receive for full-year 2021, according to its budget plan.

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, and on instant lotteries. There is also tax on commissions earned by operators of gambling junkets.

Macau’s 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.

Macau’s July casino GGR was MOP8.44 billion, up 29.2 percent sequentially.