Operator News
Argentina – Policy shift fails to stifle industry revenues
By Lewis - 2 January 2018
According to the Institute of Gaming and Casinos, (IPJC) of the province of Mendoza income generated for the state by casinos, lottery games and betting on horse races, stood at $2,420m more than US$142m in the first ten months of this year. Casino gaming made up almost 90 per cent of the total. 8 percent of the total was generated by local lottery games such as the locally run Quiniela and Tómbola as well as national lotteries such as the national Quini 6 and Loto, amongst others lottery games. The remaining 2 per cent was generated by the racetrack, which raised almost $10m. In all gaming grew by around 20 per cent roughly matching inflation. Combined the five state run casinos and the seven privately run establishments (located in the main in five star hotels) generated $2,100m for the state from January to October.
According to local laws, the IPJC must transfer no less than 35 per cent of its annual income to hospitals and different health care programs as well as set aside an additional portion of tax revenue for Cultural and Social Development programs. This year a total of $250m was budgeted for these programmes calculated on the basis that $714m would be generated by the industry. However according to local news portal Los Andes, so far only half of this amount ($137m) has been transferred and the IPJC estimate that $152m will have been transferred by end of the year, that is, 60 per cent of what had been predicted.
President of the IPJC, Josefina Canale, explained that the shortfall was due to unpaid debts running over from previous years, higher expenses and a recent spate of closures. In all this is the fourth year in a row that there has been a shortfall in the transfer of funds to other state run programs. Canale said that five casinos has been closed which “have had a significant impact on the income we have had.”
The closures are the result of a distinct shift in government policy when it comes to gaming. In June 2016, it was announced that the government had decided not to extend the licences of a number of state run casinos in the province because they were not meeting the gaming board’s objectives of generating tourist income and were no longer profitable.
