Macau Folds on Levying Entrance Fee on Tourists, Casinos Rejoice
Posted on: May 7, 2020, 11:32h.
Last updated on: May 7, 2020, 12:02h.
Officials in Macau are ending their considerations of imposing an entrance tax on tourists arriving in the Chinese Special Administrative Region (SAR).
Following a record year in 2019 where more than 39.4 million visitors ventured into the enclave, the Macau Government Tourism Office (MGTO) considered placing a toll on tourists to access the world’s richest casino destination. The COVID-19 pandemic, however, has essentially shuttered global and domestic travel, and Macau has closed its borders to all countries and areas other than China, Taiwan, and Hong Kong.
With visitor arrivals down approximately 70 percent in 2020, the MGTO said this week the entrance tax will not be embraced.
Visitor arrivals have plunged in Macau in recent months, causing various degrees of impact on the tourism-related industries,” an MGTO statement explained. “It has become a priority at this stage for the SAR Government to bolster recovery of the trade.”
The tourism office was mulling an entrance tax on visitors ranging from MOP100-200 ($12.53-$25.06). Macau and its villages of Taipa, Cotai, and Coloane measures approximately 44.5 square miles.
Casinos remain the backbone of Macau’s economy, and generate nearly 90 percent of the enclave government’s tax revenue.
The six licensed casino operators reported gross gaming revenue (GGR) of $37.855 billion in 2019 – or a little more than $3.15 billion a month. Through April, they’re averaging less than $1 billion – a 69 percent plunge.
The MGTO conducted a feasibility study on a potential tourist tax last year. It found that 95 percent of Macau residents supported such a tariff, while 80 percent of Macau businesses involved in tourism were in opposition.
“With the pivotal role of tourism in the local economy, the course of tourism development towards sustainability directly influences Macau’s economic prospects,” the MGTO added. “After comprehensive contemplation of the study findings, the characteristics of local tourism, as well as the turn of the situation, the SAR Government decided to end its consideration of tourist tax imposition.”
Tourism officials added that the entrance charge would be in opposition of Macau’s goal to restore tourism.
Long before the pandemic hit, Macau decided it was in its best interests to reduce its reliance on the VIP high roller.
Casinos began to cater to more of the mass market, and invested in non-gaming projects, such as entertainment, as well as additional convention and business space. Beijing is additionally working to form a stock market exchange based in Macau.
Critics to the potential tourist tax said such a regulation would most impact low-end visitors and day-trippers – the precise market many Macau casinos are now targeting. However, a little more than half of the visitors surveyed last year said an entrance fee would not impact their travel decisions to Macau.
The MGTO said today that “regulating increase in visitor numbers by levying a tourist tax may not be the most effective measure applicable to Macau.”
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