Singapore’s two casinos have been given the green light for major expansion but also imposed higher taxes on gambling revenue and boosted casino entry levies by 50%.
On Wednesday, Singapore’s government announced plans to extend the exclusivity period granted to the city-state’s two integrated resorts (IR), Las Vegas Sands’ Marina Bay Sands (MBS) and Genting Singapore’s Resorts World Sentosa (RWS). The two IRs will now have the market all to themselves until at least 2030.
The two IRs have also been granted permission to expand their gaming floors beyond their current 15k-square-meters apiece. MBS has been okayed to expand its Approved Gaming Area (AGA) by an additional 2k-square-meters, on which it can place an additional 1k gaming machines. RWS was granted a smaller expansion, an additional 500-square-meters to accommodate another 800 machines.
The government said it was granting these perks to the IR operators based on their “substantial investment” to date and to ensure “business certainty” for their operations going forward. On top of the total S$15b (US$11.1b) the two operators initially invested to build their properties, they have now committed an additional S$9b ($6.65b) toward non-gaming amenities to boost tourism.
Sands’ expansion plans include a fourth tower boasting 1k hotel rooms catering to the VIP crowd, along with a 15k-seat entertainment area and expanded MICE (meetings, incentives, conferences and exhibitions) space. Sands said the cost of this expansion would be around S$4.5b but offered no timeline for its completion.
Genting’s expansion will also cost S$4.5b and will involve two new ‘destination’ hotels offering a total of 1,100 rooms plus a pair of new attractions – Minion Park and Super Nintendo World – at its Universal Studios Singapore theme park. Genting says the timeline for completion is around five years.
TAXES, LEVIES GOING UP
The government also dealt the operators a blow by announcing plans to hike their gambling taxes starting in March 2022. The current 5% tax on ‘premium’ (VIP) gambling revenue will rise to 8% on the first S$2.4b of gross gaming revenue, while anything over that sum will be taxed at 12%. Mass gaming revenue wasn’t spared, as the current 15% rate will rise to 18% on the first S$3.1b and 22% on mass revenue above that sum.
The government has vowed not to impose any further gaming revenue tax hikes for a 10-year period ending in 2032. However, should the IR operators fail to honor their non-gaming investment pledges, the government will impose flat taxes of 12% and 22%, respectively, on all premium and mass gaming revenue.
The government also announced a hike in the casino entry levy paid by local citizens and permanent residents from its current S$100 per day to S$150, while the annual levy cost will rise to S$3k from its current S$2k. These hikes will take effect at midnight on Thursday, April 4.
Local gamblers have grown more blasé about entering the two IRs since the properties opened in 2010. A survey by the National Council on Problem Gambling found the local problem and pathological gambling rate fell from 2.6% in 2010 to 0.9% by 2017 as the thrill of entering the casinos wore off.