In the Philippines, Manila’s attempt to challenge the casinos of Macau and Singapore has been hit by a ruling that the country’s casino operators must pay 30 per cent corporate income tax.
While the companies involved in the four casino hotel projects being developed at Manila Bay’s Entertainment City showed little public concern, investors reacted adversely. Shares in Melco Crown (Philippines) Resorts fell 12.6 per cent, Belle Corp’s were down 10.3 per cent and Bloomberry Resorts and Alliance Global Group fell 5.8 and four per cent respectively.
Until now, the understanding was that the casinos would pay a five per cent franchise tax from gross gaming revenue as part of gaming fees of 25 per cent tax on gross mass market gambling revenue and 15 per cent on VIP turnover.
“The low tax level was the magnet that attracted foreign investors to team up with Filipino partners in the gaming business,” wrote a commentator in Malaya Business Insight. “The tax will kill the goose that lays the golden egg.”
The first of the four planned Entertainment City casino hotels, Bloomberry’s Solaire Resorts and Casino, opened on March 16. The other three - Travellers’ Resorts World Bayshore, the Belle and Melco joint venture Belle Grande Manila Bay and Universal Entertainment’s Manila Bay Resorts - are far from completion.
