Tax raise worries the Panamanian industry
A 5.5 per cent consumption tax on the gambling industry continues to corner local casinos and raise objections by different bodies.
Panama.- The gaming industry in Panama continues to protest against a 5.5 per cent consumption tax recently set as it becomes difficult for casinos to get benefits from operations. Excluding an extraordinary income posted by Codere’s payment to renew certain concessions, the industry recorded a 2.9 per cent revenue drop year-on-year during 2017 and its future is still uncertain.
“[The consumption tax] is totally absurd and unfair to say the least and is affecting players’ willingness to attend casinos,” stated Antonio Alfaro, president of Panamanian trade body ASAJA, adding: “No one in their right mind would look favourably on a levy that does not apply to players’ winnings, but solely their intention to play.”
As Panama continues to position itself as a potential gateway to Latin America for Chinese tourism, the tax increase is also affecting the gambling segment’s performance with foreign players. “The greatest impact has been seen in table gaming participation, which is the preferred form of gambling amongst tourists,” Alfaro said, arguing that tourism won’t benefit casinos as long as the levy stands at 5.5 per cent.
“We consider that it’s time to put a stop to this, to establish a moratorium on further casinos, and to not authorise any further licences for however long is prudent,” he said and asserted: “The government should rescind the 5.5 per cent tax – at least for table games – in order to stimulate the tourist market and to permit the casino industry the chance to recover.”
