The fate of Goa gambling industry now lies in between the clutches of Indian politicians who are now using the issue to gain political leverage.
Business Today reported that both the Indian Congress and Indian political parties have threatened to ban casinos in Goa, as they accused operators of cheating the state government of Rs 45,000 crore ($6.62 billion) in tax revenues.
The threat comes at a time when Goa casino continues to reel from the recent demonetization of INR 1000 (USD 14.8) and INR 500 (USD 7.32). Indian Prime Minister Narendra Modi in November made the move in a bid to slam down hard on the country’s black money.
They claimed that they have passed a resolution to close casino industry in Goa and it will also feature in their manifesto.
“The state is losing Rs 5,000 crore annually, which ought to have been collected as tax from them. There is corruption involved in allowing casinos to continue. We will not allow casino business to continue in Goa. It is very dangerous for the state,” AICC secretary Girish Chodankar said, according to the news report.
Goa is one of the three states—Sikkim and Daman were the other two states—that allow live casinos to operate within its borders. The coastal state currently plays host to 11 land-based gaming venues and five floating casinos.
In August 2016, the state government hiked—for the third year in a row—the licenses fees for land-based casinos. Casinos occupying up to 100 square meters are now required to pay over USD500,000 every year, while those occupying between 500 to 700 square meters must pay close to USD 1 million in license fees.
The opposition claimed that Goa casinos do not only promote tax fraud but they also pave the way for other crimes such as money laundering, drugs and prostitution. In a recent rally, Delhi chief minister Arvind Kejriwal slammed pro-Goa casino politicians for conniving with casino operators.
But if casinos were to close, around 5,000 to 10,000 people stands to lose their jobs. Analysts also estimate that the state will lose around 3 million tourists. At present, Goa casinos are feeling the pinch of Modi’s demonetization scheme, bringing their revenues down to 80 percent in November.