CASINO

Saipan seeks new taxes on Imperial Pacific’s casino revenue

TAGs: imperial pacific, saipan

imperial-pacific-saipan-casino-taxSaipan casino operator Imperial Pacific International Holdings is facing legislation that seeks to impose new taxes on its gaming revenue.

On Monday, the Marianas Variety reported that two House of Representatives lawmakers – including Vice-Speaker Janet Maratita – planned to introduce legislation on Tuesday that would impose a 5% tax on all gaming revenue generated in the Commonwealth of the Northern Mariana Islands (CNMI).

Saipan’s only gaming licensee Imperial Pacific currently operates a temporary casino, Best Sunshine Live. Its in-development permanent resort, the Imperial Pacific Resort Hotel Saipan, is supposed to open its first phase sometime this spring, although the company appears to be having some difficulty raising the necessary financing to complete the project.

The new HB 20-31 legislation claims that Imperial Pacific’s operations are “largely untaxed and the time has come to tax it in a fair and reasonable manner.” Imperial Pacific currently pays business gross revenue tax, a $15m annual fee to retain its casino exclusivity on Saipan, plus $20m more in annual contributions to a Community Chest Fund. Imperial Pacific has yet to comment publicly on the new legislation.

This isn’t the first time Saipan legislators have attempted to squeeze more from Imperial Pacific. Last summer, Rep. Edmund Villagomez proposed a 10% tax on gaming revenue but Commonwealth Casino Commission exec director Edward Deleon Guerrero advised against it, suggesting legislators wait until Imperial Pacific’s permanent venue had been open for “a year” before increasing the company’s financial burden.

Legislators are apparently keen to use Imperial Pacific to help close some budget gaps. Last week saw new legislation proposed that would require a certain proportion of the government’s casino fees to be used to top up a recent 25% reduction of CNMI residents’ retirement pensions.

In other Imperial Pacific news, the company has formally rejected allegations of financial shenanigans made in a former exec’s wrongful termination lawsuit. Former Best Sunshine VP of table games Danny Ewing claimed he was terminated last August because he refused to go along with alleged breaches of Imperial Pacific’s financial reporting requirements to US federal authorities.

In an affirmative defense answer to Ewing’s complaint, Imperial Pacific attorney George Hasselback said Ewing had failed to state a claim upon which relief may be granted. Hasselback also challenged whether the US federal court had jurisdiction over Ewing’s claims.

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