Macau Casinos Limited to 6K Tables, 12K Slots Under 2023 Regulatory Regime
Posted on: August 28, 2022, 09:55h.
Last updated on: August 29, 2022, 01:07h.
For the first time, Macau casinos will face a cap on the number of table games and slot machines they can collectively offer across their floors in the Chinese gaming enclave.
The concessions for the six Macau casino operators expire at 12:01 am CST on January 1, 2023. However, the local government is expected to issue the six companies fresh tenders before their current licenses expire.
Macau’s next gaming governing conditions will include operating privileges running only 10 years — half of the 20-year current terms. Another key change is that Macau will limit the industry’s total allotment of gaming positions.
The Macau government revealed that casinos will be capped at 6,000 table games and 12,000 slots last Friday. Macau lawmakers decided to limit the number of gaming positions for the 2023-2033 regulatory environment to “control the scale” and foster the “healthy development” of the casino industry and region as a whole.
At the end of 2021, Macau’s six casino giants counted 6,198 table games and 11,758 slots at their properties. Baccarat is the go-to game of choice in Macau. The table game is the most popular format in many Asian gaming markets.
Minimum Tax Set
Macau lawmakers tasked Chief Executive Ho Iat Seng with deciding a minimum gaming tax per machine and table that the enclave will impose under the next regulatory regime. The region’s top government official says he will afford the industry a relatively light minimum tax.
Revealed through the Macau Gazette, the government’s official news source, Ho demanded that each issued table game generate a minimum of MOP7 million (US$866,000) in gross gaming revenue each year. Each slot machine must win MOP300,000 (US$37,000) from gamblers.
If the casinos take advantage of the region’s full allotment of tables and slots, Ho’s minimum GGR requirement per seat/machine would equate to full-year revenue of roughly MOP45.6 billion (US$5.6 billion). Through seven months of 2022, Macau’s gaming industry is just ahead of Ho’s forthcoming minimum tax pace.
2022 is shaping up to be the Macau gaming industry’s worst year of the pandemic. GGR January through July this year totaled $3.28 billion. Through seven months of 2020, GGR was $4.32 billion. Casinos won more than $7 billion during the first seven months of 2021.
Ho basing his future tax minimum obligations on 2022 revenue is welcomed news by the six operators, as most casino executives are hopeful that the industry has hit its pandemic bottom.
Macau policymakers hope to lessen the region’s reliance on casino gambling in the years ahead. Casino taxes before the pandemic accounted for more than 80 cents of every tax dollar received by the local government.
Macau was considering ways to diversify its economy before the pandemic. But the coronavirus only heightened the need for the government to find new tax sources in the event of another health crisis that results in lockdowns and the cessation of nonessential businesses.
The limitation on gaming positions seems to value quality over quantity. Only two years ago, Macau casinos ran upwards of 6,700 table games and 17,000 slot machines.
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