Macau’s Chief Executive, Ho Iat Seng, addressed the media on Tuesday, expressing skepticism about the city’s gross gaming revenues (GGR) reaching MOP$180 billion (US$22.4 billion) this year. This uncertainty could potentially spare concessionaires from a mandated increase in non-gaming spending in 2024, as stipulated in the new 10-year concessions signed by Macau’s six operators.
Gaming Revenue Outlook:
Chief Executive Ho Iat Seng cast doubt on the likelihood of Macau’s GGR reaching MOP$180 billion this year. The figure is crucial as, according to the new concessions, a threshold breach triggers a 20% increase in mandatory non-gaming spend for concessionaires in the following year. Ho emphasized the improbability of reaching this milestone, providing a cautious perspective on the city’s gaming performance.
Non-Gaming Investment Plans:
Ho stated that the government had not yet endorsed the non-gaming investment plans submitted by concessionaires for the upcoming year. The lack of formal approval indicates a cautious approach to evaluating these proposals, reflecting the government’s commitment to ensuring that non-gaming investments align with broader economic and tourism objectives.
Foreigner-Only Gaming Zones and Tax Breaks:
Last year, Ho introduced the concept of tax breaks of up to 5% on revenues generated in foreigner-only gaming zones, aiming to boost international visitation. However, Ho provided limited insight into the GGR figures of these zones during the recent press session. He acknowledged having the information but refrained from disclosing it, citing the challenge of attracting gamblers to these specific areas.
Approval Status of Tax Breaks:
When questioned about whether any concessionaires had been granted tax breaks, Ho remained non-committal, neither confirming nor denying such approvals. This lack of transparency adds to the uncertainty surrounding the specific incentives provided to concessionaires operating in designated gaming zones aimed at attracting international visitors.
Government’s Evaluation Stance:
Ho’s reluctance to confirm the GGR figures and the approval status of tax breaks suggests a meticulous evaluation process by the government. The cautious approach aligns with the administration’s commitment to balancing economic interests with broader strategic goals, ensuring that incentives drive the desired outcomes in Macau’s evolving gaming landscape.
Chief Executive Ho Iat Seng’s remarks provide valuable insights into the current dynamics of Macau’s gaming industry. The skepticism regarding GGR reaching the MOP$180 billion threshold, the cautious evaluation of non-gaming investment plans, and the limited disclosure on tax breaks for foreigner-only gaming zones collectively underscore the government’s measured approach to managing the gaming sector. As Macau navigates economic challenges and strives for sustainable growth, the careful consideration of key metrics and incentives is essential for maintaining the region’s position as a global gaming and entertainment hub.