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Paraguay – Brazil’s casinos will not affect Paraguay

By - 30 March 2016

The Head of Paraguay’s gaming commission Javier Balbuena (CONAJZAR) has said that if the Brazilian government legalises gaming then it will not affect Paraguayan casinos because the taxes paid in Paraguay are much lower.

Mr. Balbuena made his comments following statements from industry insiders who argue that if the Brazilian government legalises gaming then it will have a negative impact on the tourism industry in Paraguay specifically in the border cities which are most frequently visited by Brazilian tourists.

Mr Balbuena said that the government is still attractive to investors as under current rules it has the lowest tax burden in the region. “In Brazil, taxes are high. By investing in casinos, apart from paying excise duty on gaming, investors are going to have to continue paying normal commercial taxes as well. In this regard Paraguay still has an advantage for investors and we from CONAJZAR are reviewing what we can do about it,” he said.

However, the official argued that Paraguay’s gaming law needed reform in order to attract more investment. Balbuena said that one of its limitations is that casino licences can only be granted in the departments of Asunción, Alto Paraná, Itapúa, Amambay, Cordillera, Misiones and Central so a number of other departments are left out. In addition only more than one casino may be established in the city of Asunción and departments with more than 250,000 inhabitants. Consequently other departments such as Canindeyú and Concepción are left out despite the fact that there have been numerous requests to operate gaming establishments in those departments.

However, a bill introduced by Deputy Oscar Tuma would eliminate the clause which sets limits on where casinos can be located but disagreement remains over the last paragraph of the draft law, which states that contracts may be automatically renewed without being put up for tender. A new project, Mr. Balbuena said, now in development could resolve the issue once and for all. “There is a project that comes from CONAJZAR, which is much bigger and it organises the business of gambling much better. It will create the possibility of having Las Vegas type casinos, which is what is intended for Ciudad del Este not small casinos but casino resort hotels,” he said. In addition, the new rules establish the possibility of granting licences for longer terms and would implement the online monitoring of casinos.

Earlier this month CONAJZAR announced that it would increase its efforts to push for a bill that will make it an entirely autonomous body. The aim of the new bill is to give CONAJZAR its own legal status, its own budget and full autonomy so that it will no longer be part of the Ministry of Finance. Current law dated back to 1997 and new types of games including online gaming and other technological advances in the industry are not covered by the old act. Meanwhile, licences for five to ten years may not be sufficiently long enough as it may discourage operators from taking part in licence tenders in the future.

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