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Spain – President of Extremadura wants large scale casino resorts

By - 27 March 2018

The Spanish Socialist Workers’ Party PSOE has come out in support of a new bill, which would allow for the creation of large leisure facilities in the Spanish autonomous community of Extremadura.

If the bill finds support from the State Council then it could mean that it could go before the full house within the next month. The initiative would reduce urban planning and administrative deadlines by half as the projects would be fast tracked as a matter of urgency. The new rules are part of a new plan to bring investment into the area as the government is facing a shortfall in state finances of €300m.

The proposal would create a legal framework, which would allow for the construction in Extremadura of large complexes that combine tourist establishments such as hotels, spas, cultural facilities, conference centres, golf courses and aquatic recreation centres alongside other facilities designed for adult leisure including casinos, bingo halls and slot parlours.

The President of Extremadura (PSOE) Guillermo Fernández Vara announced that the objective of the new rules is to enable and attract the development of large theme parks and family leisure centres in the region. The new centres would be aimed at attracting visitors from abroad. There is already at least one foreign developer interested in developing this type of site in the region of La Siberia located in the north-eastern portion of the province of Badajoz said Fernández Vara. However, according to the governor, there are “several” investors who are “waiting for the door to open.”

New rules would allow for large-scale resorts, which would call for considerable investment. Fernández Vara told press that the minimal requirements would be those projects that spanned at least 1,000 hectares, and would require a minimal investment of €1,000m. The project would also need to create at least 2,000 direct jobs and generate 3,000 hotel beds. A €10m deposit would also be required. The requirements are also much higher if the project is located in the region of Siberia.

Favourable conditions would be imposed when it comes to gambling taxes. In the case that the new centres include casinos, deductions of up to 80 per cent in gaming taxes are now being considered by the government but this would depend on the total amount invested in the construction of the complex as well as other facilities on site.

Investors will also benefit from both legal and fiscal advantages. When it comes to casinos these will be exempt from local rules covering the granting of licences which both requires public licence tender processes and limits the authorisations to one casino per 500,000 inhabitants.

As for tax, a fixed rate of 15 per cent will be established for casinos in the new resorts. This percentage is currently applied when gaming income does not exceed €2m per year, but it reaches 30 per cent when it goes beyond €2 and reaches the €4m mark. This rate increases to 40 per cent when it goes beyond €4 and reaches €6m and stands at 50 per cent when it reaches €6m and above. However as compensation for the total investment made a deduction of up to 80 per cent of the tax will be put into place.

According to the timetable, companies must present the project to the government, which would include data on the company, along with a preliminary urban plan, a preliminary environmental study as well as an economic-financial study. These plans will need to outline the creation of jobs, work schedule, along with the necessary infrastructure.
Once the request is received, the government will create a special inter-administrative commission that within a maximum period of one month will examine the project, after which it will issue a technical bid evaluation. Within that period those municipalities affected by the new project will be given fifteen days audience before the commission.
The qualification of the proposal as a large leisure facility will reduce the processing time by half. If the project includes casinos, the authorisation will cover all types of gambling contained in gaming legislation already in place in Extremadura. In total, the process will take from five to six months.

After that, building work must begin within a maximum period of six months from the publication of the management plan. The execution of that plan may not exceed five years. Once work is completed, the developers will have six months to put at least 50 per cent of the site into use and one year before it is fully open to the public.

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