South Korea casino group reiterates opposition to proposed tourism levy hike and licence changes
The Korea Casino Association says the measure would increase operating costs and create uncertainty for casino operators amid growing competition from integrated resort developments elsewhere.
South Korea.- South Korea’s casino industry has urged the government to withdraw proposed reforms for the sectors. The Korea Casino Association says proposals to increase the tourism levy on foreigner-only casinos and replace permanent operating licences with renewable licences could reduce investment and weaken the country’s competitiveness against regional rivals.
The Ministry of Culture, Sports and Tourism has proposed raising casinos’ maximum contribution to the Tourism Promotion and Development Fund from 10 per cent to 15 per cent, while licences would be renewable ever five years. The association said both measures would increase operating costs and create uncertainty for casino operators amid the prospect of increased competition from integrated resorts elsewhere in Asia, including MGM Osaka in Japan, which is scheduled to open in 2030.
It noted that contributions to the tourism fund are calculated on gaming revenue rather than operating profit, requiring payments even during loss-making periods. It said around half of South Korea’s 18 casino operators have reported operating losses in most years over the past decade. It also argued that the industry already pays corporate tax, local taxes and individual consumption tax.
It estimates that raising the contribution ceiling could increase annual payments by about KRW76.3bn (US$49.8m) for three major mainland casino operators.
As for licences, it noted that South Korea has issued casino licences without expiry dates since amendments to the Tourism Promotion Act in 1994. It argued that periodic renewals would increase financing and regulatory uncertainty for projects requiring long-term capital commitments while potentially affecting employment.
The ministry says the proposals are intended to better reflect the industry’s growth. It argues that revenue from foreigner-only casinos has increased substantially since the current contribution framework was introduced and that the existing structure does not differentiate sufficiently between high and low-revenue operators. The proposed 15 per cent rate would apply only to a high-revenue bracket, with the threshold yet to be defined.
The proposals are scheduled for discussion at a National Assembly forum today. The outcome of the debate could determine whether the government proceeds with the proposed reforms or revises the measures in response to industry feedback.
