RHB Investment Bank has said a new increase is unlikely as Genting Malaysia is still recovering from the financial hit wrought by the pandemic.
Malaysia.- RHB Investment Bank has said it does not expect the government to declare any increases in casino taxes.
Two years ago, the government took casino tax duties to 35 per cent, which the bank says remains one of the highest rates in the region.
With Genting Malaysia heavily impacted by the Covid-19 pandemic, the bank does not expect a further hike for now.
It said in a statement published by The Edge Markets: “Even though Resorts World Genting has reopened, the recovery pace is still slow due to the social distancing rules in place. Hence, another round of tax hike is unlikely as the sector is no longer low-hanging fruit.”
In 2010, the pool betting duty in Malaysia was increased from 6 per cent to the current 8 per cent. operators (NFOs) have also been negatively impacted by Covid-19, with a total of 40 draws cancelled, so increases in duties are not expected in here either.
The bank noted that any such measure could play against tax collection, as it would lower the prize pay-out.
It said: “Although NFOs have staged a strong ticket sales recovery since the economic reopening, they have yet to reach pre-pandemic levels (currently only at 80-85 per cent of pre-pandemic levels).
“In order for the government to harvest extra tax revenue, we believe stricter enforcement on illegal operators is a more feasible solution.”