Operator News
Russia – Summit Ascent asks for status quo on Tigre de Cristal tax rates
By Phil - 8 November 2017
Summit Ascent, the operator behind the Tigre de Cristal in the Primorsky Region in the Russian Far East, has said it could be subjected to higher taxes if federal Government approves changes to the tax laws.
The Federal Government has recently submitted a draft bill to the State Duma proposing an increase to the range of tax rates. The proposed monthly tax levies would be doubled. The draft bill has gone through the First Reading by the State Duma.
Currently each gaming table is taxed at RUB125,000 (approximately US$2,145) and each gaming machine at RUB7,500 (approximately US$129).
John Wang, Deputy Chairman and Executive Director, said: “Unlike Macau or the Philippines, gaming tax in the Russian Federation is not levied based on a percentage of gaming revenue. The Russian Federation has established a gaming tax system which is based on a fixed levy on each gaming device deployed in a particular calendar month in the casino. Gaming taxes are payable to the local governments.”
If the draft bill becomes law and the Primorsky Krai Duma opts to levy gaming tax at the highest possible rates permitted by the Federal Law, Mr. Wang said there will be a negative impact of approximately RUB9,020,000 (approximately US$154,770) on the monthly gaming tax payable of Tigre de Cristal, equivalent to an annual negative impact of approximately RUB108.24m (approximately US$1.857m) assuming that the same number of gaming tables and gaming machines will be in operation as in September 2017.
He added: “For a new law to be enacted in the Russian Federation, the draft bill has to pass through three readings in the State Duma and finally be approved and signed off by the President. Therefore, it is too early for the board of directors of the Company to predict whether the above proposed changes will become legally enforceable. Management has recently been in contact with representatives from the Primorsky Government regarding the proposed tax changes. In order to attract investors to continue investing in the Primorsky Integrated Entertainment Zone, the current intention of the Primorsky Government is to propose to the local Duma (i.e. the Primorsky Krai Duma) to maintain the tax rates at existing levels (as they are within the ranges proposed in the draft bill), if the new federal law were to be enacted.”
