The Cambodian government took in less than half the expected amount of tax revenues from the country’s gaming industry due to the impacts of Covid-19. According to the Phnom Penh Post, taxes collected from the nation’s 193 licensed casinos fell 53 percent, from more than US$85 million in 2019 to US$40 million in 2020.
“As we’re all too well aware, the Covid-19 epidemic began in late 2019 and persists to this day,” said Ros Phearun, deputy director of the Ministry of Economy and Finance. “It has pulverized all economic sectors, and the casino industry has sustained a crippling blow as well.
“Practically all of our casinos ceased operation in 2020, with only just seven or eight left scrambling to keep their businesses afloat. That’s why our revenue collection has dropped so much.”
Prime Minister Hun Sen ordered the casinos to close on April 1, 2020; they didn’t start to reopen until August, and some didn’t resume business until as late as October. Tax revenues were also slashed by a nationwide ban on online gambling, which saw all previous online licenses expire on January 1, 2020.
In November, Cambodia established flat tax on gross gaming revenues of 4 percent for VIP and 7 percent for mass. “We expect tax collection from our casino industry to improve in 2021 thanks to our compliance with the recently-passed law,” Phearun said. “We’ll collect [taxes] in a transparent way, but as Covid-19 continues to spread and slash tourist arrivals, we dare not predict what the revenue from this sector will be.”
