Sri Lanka Weighs New Gaming Levies

The government of Sri Lanka plans to double the tax on gaming revenue and charge domestic players a Singapore-style fee to enter three resort casinos planned for the capital of Colombo (Crown proposal at left). As a trade-off, the government has overcome stubborn political opposition to secure for each of the projects a 10-year moratorium on corporate income tax.

If Mahinda Rajapaksa wins an unprecedented third term as Sri Lanka’s president it’s going to cost three major gaming resorts planned for the capital of Colombo a lot more money to operate.

Crown Resorts, for one, which wants to include a casino as part of a US$400 million luxury resort, will be assessed a gaming tax doubled to 10 percent of revenue, and Sri Lankans wishing to gamble will be charged a $100 fee per visit to enter the casino.

The levies are part of Rajapaksa’s new budget plan. The president is running for re-election in January.

In May, the government gave approval for all three projects to go ahead, albeit without casinos, but it did grant them 10-year moratoriums on corporate tax despite vocal opposition from the minority United National Party and some of Rajapaksa’s own governing coalition partners.

There has been speculation that the three projects would be able to operate as casinos by transplanting licenses already held by the country’s two domestic operators.

Crown is developing Crown Colombo in partnership with Rank Holdings, which holds one of the country’s two licenses. A 2018 opening is targeted for the property, which will include 450 luxury hotel rooms, a signature restaurant and bars, a spa and pool and a “thematic lake water feature”.