The Primorye gaming zone in Russia’s far east has decided against hiking gambling taxes for fear of deterring future investment by international casino operators.
Late last year, Russia approved plans to allow each of Russia’s designated casino zones to double the fixed monthly taxes on gaming tables and slot machines, which vary from zone to zone. Most of these gaming zones have since taken advantage of this opportunity to top up their tax coffers.
This week, the government of the Primorsky territory announced that it had decided to maintain its gambling taxes at their current rates of RUB125k (US$2,170) for each gaming table and RUB7.5k ($130) for each electronic gaming machine.
Government officials explained their decision to stand pat as a means to attract further international casino investment to the Primorye gaming zone. At present, Primorye has one working casino – Tigre de Cristal – and two in-development projects by Russian operator Diamond Fortune Holdings and Cambodian casino operator NagaCorp.
In December, Melco Resorts & Entertainment boss Lawrence Ho sold his stake in Summit Ascent, the company that holds a majority stake in Tigre de Cristal, after expressing frustration over Russia’s increasingly uncertain tax environment.
Taiwan shipping firm First Steamship subsequently acquired a major stake in Summit Ascent. Primorye officials declared last week that First Steamship has pledged to “take an active part in the development” of the gaming zone, as well as investing in “regional tourism projects that are not related to gambling activities,” the details of which weren’t specified.
Despite First Steamship’s enthusiasm, Primorye’s lack of critical infrastructure has also helped keep many investors on the sidelines. Last fall, Primorye officials were forced to extend the deadline for an auction of unused land plots, before scrapping the auction altogether due to a lack of bidders.