South Korea Collects $54.56Bn in Gambling Taxes (2000-2015)April 14, 2017 11:02 am
This week, the Korea Taxpayer Association revealed that the South Korea government received $54.56 billion in taxes from the country’s gambling industry between the 2000-2015 period.
From that figure, horse racing accounted for a whopping 37.5% of taxes, followed by the lottery (25.4%), and then the peninsula’s various land-based casinos (12.3%). Furthermore, tax revenues have continued to grow at an impressive rate, having doubled over the past decade and a half, while profits have increased fourfold.
While South Korea legalized casino gambling fifty years ago, access to the country’s 17 land-based casinos is only permitted for foreign visitors, with the country’s 50 million citizens barred from entering all but one venue, the one that is located in Kangwon Lan in the Kangwon province. Despite this severe restriction on potential revenues, developers hoping that the draconian law would eventually be reversed have invested heavily in the industry over the last few years.
Macau’s two-year losing streak also further motivated developers to back South Korea to be the next Asian gambling hot spot, with Paradise City in Seoul, the country’s first casino resort, due to open for business in the next few weeks. The development is a collaboration between Korean firm Paradise Co and Japan’s Sega Sammy, however, optimism over its potential popularity has been dampened by Macau’s casino market having now returned to growth, as well as Japan having recently approved casino gambling of its own.
Furthermore, Chinese gamblers may also be less inclined to visit South Korea in the future on account of the political tension which exist between the two countries due to escalating concerns over the Chinese-backed North Korea, and the US missiles that are deployed in South Korea. Last year, 17 million Chinese visited the country, and as David Bain from Aegis Capital Corp, explains:
“Mainland Chinese travelers may look to Macau and other destinations as an alternative to South Korea.”