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Russia – Doubling of gaming tax to slow Tigre de Cristal’s next phase

By - 30 November 2017

Russia’s Far East operator Summit Ascent is likely to delay the opening of the second phase of Tigre de Cristal, its casino in the Russian gaming zone of Primorsky due to an increase in taxation.

Union Gaming Securities Asia believes the operator’s EBITDA for 2018 could fall six per cent if the new taxation laws are approved by the Duma.

Union Gaming analyst Grant Govertsen said: “Primorsky already set taxes at the high-end of the federal range, and should the bill be passed and Primorsky choose to remain at the high-end, this would have an HK$11mimpact on our 2018 EBITDA estimate (six per cent below our current forecast). There is further speculation that tax rates could be adjusted higher still post-2018.”

Mr. Govertson believes Summit will ‘slow-play the development of Tigre de Cristal’s phase 2, which is slated to open in the second half of 2019.’

“While there has been some enforcement against illegal gaming venues in much closer proximity to the population base relative to the company’s property, the vast majority of locals-oriented GGR is still being captured by illegal venues,” he explained.

The plan is to double table gaming tax to 250,000 rubles per gaming table, up from 125,000 rubles and to double slot tax per machine from 7,500 rubles to 15,000 rubles.

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