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Legislation

Chile – Chile Senate extends municipal licences for 15 years

By - 7 June 2013

The Chilean Senate has approved a law which will extend casinos licences held by local municipalities for a further 15 years.

In 2005 the government green lit the construction of eighteen additional casinos to the seven municipal casinos already in operation. The casinos which were already licenced before the new act come under the supervision of the local municipalities where they are located and are a vital source of funding locally. Combined they generate around US$90m a year in tax revenue for local governments and in some cases account for half of the annual budget.

The licence for the seven other casinos in Chile was due to end on 31 December 2015. From that point on the casinos were to come under the control of the Chilean Gaming Control Board. However, the government had been looking at a number of measures which would have eased the transition and soften the impact of the decrease in casino tax revenues. One proposal was to allow for a ten year transition stage which would have gradually reduced the amount of gaming income which was destined for the local municipalities where they are located.

However, led by the mayor of Viña del Mar, Virginia Reginato local city mayors have been lobbying the government for a change in the law.  The new law, which was passed this week by the Senate, extends the licences for a further fifteen years and puts the casinos once again under the supervision of the local municipalities. The further fifteen year extension is designed to give the local municipalities enough time to look for ways to raise the additional tax income once the licences run out in 15 years. Now that the act has been passed by the Senate it has been earmarked as a matter of urgency for Presidential approval.

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