Japan, poised to launch three casinos in the first phase of its gambling expansion plan, is looking to adopt a withholding tax system for its prospective casino gambling industry.
Earlier in the week, the Japanese government revealed its plans to tax casino winnings by withholding taxes on winnings by nonresident foreigners at casinos.
Also, to make casinos compliant with this taxation policy the government wanted the chosen operators to keep track of chip purchases and win-loss results.
However, it seems that the plan to tax casino winnings did not go well with sections of Japanese lawmakers including those in the government.
Some lawmakers are skeptics of the plan and have vocally expressed their concerns about the proposed taxing system.
To those in opposition to the ‘withholding tax policy’ taxing casino winnings would motivate overseas gamblers to flock to other Asian gambling destinations, thereby defeating the purpose of having casinos in the first place.
Bloomberg reports one lawmaker demanding that the law should be scrapped as it could lead to gamblers and resort operators sending their money elsewhere.
The gamblers are taxed on their winnings also in South Korea and the US, and the Japanese government is already studying the tax system.
Japan To Become A Regional Gambling Hub
Japan has already nominated members to a Casino Management Committee which is tasked with monitoring the licensing process of the casinos. Gambling operators from across the globe have already forged partnerships with local companies in order to better their chances in the competitive bidding process.
The decision to introduce a ‘withholding’ tax system doesn’t seem to have dampened the spirit of casino operators who stand in the race for a casino license in Japan.
According to the analysts at Sanford C. Bernstein, the Japanese casino market is expected to be the third-largest generating about $billion in annual revenue.