Gambling faces heavy tax burden in Malaysia

The government seeks to boost the economy amid the US-China trade war, and the gambling industry could face major taxation in Malaysia.

Malaysia.- The US-China trade war has the world worried. That’s why Malaysia seeks to boost the economy in order to reduce its impact in the region.

The government will present an expanded budget later this week. Prime Minister Mahathir Mohamad’s government needs to sustain its development spending to maintain domestic demand next year, experts say.

While the government won’t introduce new taxes in the budget, it has already reintroduced further taxes on Malaysia’s gambling. It reset a sales and services tax (SST) which raised tax payouts from gambling and other segments.

“The widening of SST is ongoing… this will continue further on Jan 1, 2020, with more imported online/digital consumer services being included,” the Maybank Investment Bank said.

Movement in Malaysia

Kien Huat Reality III, owner of 86% of the stock in Empire Resorts, has submitted its proposal to purchase all of the outstanding equity in the company. Kien Huat had informed a special committee last month of its intentions to buy up the equity.

Subject to the special committee’s approval, a subsidiary of Genting Malaysia would acquire 13.2 million shares of Kien’s common stock. The group would then purchase Empire Resorts’ outstanding equity. Kien Huat expected to remain the direct or indirect majority owner of Empire’s equity securities. This is according to a letter signed by top officials of both Kien Huat and Genting, Mid Hudson News reported.

If approved, Genting Malaysia would assist the company and its subsidiaries pursuant to an arm’s length operations agreement. “We believe that the transactions contemplated by the term sheet should provide comfort and assurance to the company’s various stockholders.