GGRAsia – Imp Pacific could face 10% net tax on gaming revenue: report


Imp Pacific could face 10% net tax on gaming revenue (report)

Commonwealth of the Northern Mariana Islands (CNMI) House Representative Tina Sablan has introduced a bill that would impose a 10% tax on net gambling revenues, according to a report published Monday in the Marianas Variety newspaper.

If passed, it would apply as it stands to the operations of Saipan’s monopoly casino business (pictured) promoted by Imperial Pacific International (CNMI) LLC, a subsidiary of the Hong Kong-listed gaming investor Imperial Pacific International Holdings Ltd.

The report also quoted parliamentary minority leader Edwin Propst, co-sponsor of Ms Sablan’s measure – House Local Bill 21-23, – as saying “it is important that we do this”. He described the tax proposal as “really very nice” since it would be taxed on net gaming income and not on gross gaming income (GGR). The measure would also be deductible from the annual casino license fee of US $ 15 million payable by the Imperial Pacific group.

In the Macau market, by comparison, there is an effective tax of 39% on the GGR, and operators also have to pay a premium to the local government to operate each mass and VIP gaming table. Macau operators are also exempt from local corporate tax.

CNMI lawmaker Mr. Propst said that while in his opinion the CNMI Net Gaming Tax Bill was fair, “the urgency is that Imperial Pacific International (CNMI) LLC no ‘has paid no tax for almost a year “. he added. The report did not specify which form of tax Mr Propst was referring to.

The 2018 annual report of the Hong Kong parent company of this company stated – in the section relating to the cost of operations – that it had a tax deduction of HKD 292.41 million (US $ 37.3 million) in its balance sheet at December 31.

The Marianas Variety further reported on Monday that another bill has been drafted by House Gaming Committee Chairman Ralph Yumul to prevent the casino operator from writing off any amount of credit advanced to players from its tax obligations. for the game, but not retroceded by them. Such tax breaks are permitted in some casino jurisdictions. But the complementary bill of the CNMI stressed that “the unpaid balances on the loans granted for the game will not be deducted from the gross income”.

In February this year, the Saipan Tribune newspaper quoted the Imperial Pacific group as saying that construction work on the “initial game center” on Saipan would be completed in 2019, althoughh less than 300 construction workers ware employed on the site.

Imperial Pacific International Holdings’ 2018 annual report noted that at the end of 2018, “approximately US $ 792 million” had been invested by Imperial Pacific in “design, consulting, engineering, building materials. and labor “for its Saipan property.

According to Marianas Variety, the Imperial Pacific Group would have paid $ 41,000 in what the media called the gross corporate income tax since July 1, 2018, compared to $ 40.9 million in 2016, $ 67.7 million in 2017 and 43.6 million USD in 2018..

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