Casino Taxation Research Articles

Modeling the Economic Effect of Statutory Taxation on Gaming Hospitality

This article shows that casino taxation may be welfare enhancing for gaming hospitality resorts due to their market power to export local taxes to tourist customers. The price-inelastic tourism demand for casino gambling plays an important role in such power of tax exportation. We use a mathematical programming model to derive a tax threshold, through which a specific tax can be identified to be good or bad for efficiency. The policy implication is that a high tax should be imposed if enough of the tax burden can be shifted to tourists, but a low tax must be offered otherwise. These results are shown to be useful in practice across travel destinations.

Casino Taxation in a Normative and Economic Context: the Case of Poland

AbstractThe aim of this article is twofold. First, it provides an overview of theoretical background of casino taxation. Second, it analyses the provisions of the Act regulating casino taxation in Poland and evaluates the consequences of the new Gambling Law in force since 2010. The first section of it discusses motives, outcomes and forms of casino taxation, taking into account inter alia the assumptions of optimal tax theory. It then deals with Polish regulations concerning the organisation of gambling in casinos and gambling tax design. The last section of the article analyses the scale of operation of Polish casinos, their revenues and the tax due on gambling activities.

Market structure and casino taxation in tourist resorts

This article examines the association of tax effects with market structure for casino gaming. We show that if market structure is uncompetitive, much of casino taxation falls on tourists whose demand is inelastic relative to supply. The tax is likely to be efficient under strong external demand if imposed on oligopoly casinos with a monopoly location in a cross-border market. The likelihood of economically ‘good’ taxation is greater under oligopoly than under competition but lower than under monopoly. Casino taxes should be lowered in a more competitive market with weaker external demand. Our prediction is consistent with the evidence found from casino tourism development in Macao with ‘high’ gambling taxes.

A Trade Based View on Casino Taxation: Market Conditions

This article presents a trade based theory of casino taxation along with empirical evidence found from Macao as a typical tourism resort. We prove that there is a unique optimum gaming tax in a particular market for casino gambling, argue that any change in this tax is engendered by external demand shifts, and suggest that the economic rent from gambling legalization should be shared through such optimal tax between the public and private sectors. Our work also studies the tradeoff between economic benefits and social costs arising from casino tourism, and provides some policy recommendations for the sustainable development of gaming-led economies. The theoretical arguments in this article turn out to be consistent with empirical observations on Macao realities over the recent decade.

Casino tourism, social cost and tax effects

Local economic growth can be spurred by casino tourism, yet this may take place at the expense of the external regions where tourists live. We show that Pigouvian taxes should be imposed on gambling activity to attenuate its external cost. The tax may boost social welfare in the local and external communities even though casinos and tourists incur certain private losses due to their tax burdens. The tax can also mitigate gaming-biased unbalanced growth via resource reallocation, and improve the terms of trade for local welfare enhancement through tourism as an exporting industry. If taxes are collected from tourists but not fully refunded, local tax policy then plays the dual roles for both social cost reduction and public revenue generation. Our empirical study suggests the importance of casino taxation for preventing the ‘exported’ social cost from coming back to hurt the local economy, for too much such exportation may trigger visa policy restrictions by tourists' home communities.

Casino Taxation in Portugal: The Supreme Court and Autonomous Taxes

Casino Taxation in Portugal: The Supreme Court and Autonomous Taxes

A General Equilibrium Analysis of Casino Taxation in Portugal

In Portugal, casinos are taxed at a 50% rate and the tax receipts are allocated to Turismo de Portugal, which can use it in different ways – subsidizing tourism firms, advertising and so on. A recent study shows that casino demand in Portugal is originated predominantly in the domestic market. There is a debate about (i) the level of the tax levied on casinos and (ii) how the tax receipts should be used, as tourists rarely visit casinos. The paper contributes to this debate. The authors develop a dynamic general equilibrium model of a small open economy, comprising an industrial sector producing an internationally traded good, a tourism sector producing tourism services offered to both foreign tourists and residents and a casino sector supplying gambling services. Domestic residents derive utility from consuming the traded good, tourism services and gambling. The model is calibrated to the Portuguese economy. Using numerical simulations, the authors discuss the welfare effects of abandoning the taxation of casinos, as well as of different uses of casino tax receipts.

Casino Taxation in Tourism Resorts

Gaming Law Review and EconomicsVol. 16, No. 5 ArticlesCasino Taxation in Tourism ResortsXinhua Gu, Guoqiang Li, and Ricardo Chi Sen SiuXinhua GuSearch for more papers by this author, Guoqiang LiSearch for more papers by this author, and Ricardo Chi Sen SiuSearch for more papers by this authorPublished Online:17 May 2012https://doi.org/10.1089/glre.2012.1656AboutSectionsPDF/EPUB ToolsPermissionsDownload CitationsTrack CitationsAdd to favorites Back To Publication ShareShare onFacebookTwitterLinked InRedditEmail FiguresReferencesRelatedDetailsCited byHouse of Cards—An analysis of Macao's resident support for tourism and casino development19 August 2015 | Tourism and Hospitality Research, Vol. 16, No. 2The Economics of Taxation in Casino Tourism with Cross-border Market Power28 January 2016 | Review of Development Economics, Vol. 20, No. 1A Trade Based View on Casino Taxation: Market Conditions25 August 2013 | Journal of Gambling Studies, Vol. 31, No. 2Examining the Gambling Behaviors of Chinese Online Lottery Gamblers: Are They Rational?14 January 2014 | Journal of Gambling Studies, Vol. 31, No. 2Casino tourism, social cost and tax effectsInternational Gambling Studies, Vol. 13, No. 2 Volume 16Issue 5May 2012 InformationCopyright 2012, Mary Ann Liebert, Inc.To cite this article:Xinhua Gu, Guoqiang Li, and Ricardo Chi Sen Siu.Casino Taxation in Tourism Resorts.Gaming Law Review and Economics.May 2012.274-277.http://doi.org/10.1089/glre.2012.1656Published in Volume: 16 Issue 5: May 17, 2012PDF download

The economics of casino taxation

In this article, a model of the costs of a casino is developed that focuses on the implications for economic welfare of different taxation schemes for casinos. The situation being considered is in a country where casinos cater exclusively to foreign tourists. The goal of the country is to determine the maximum amount of taxes that can be extracted from the activities of this sector under different systems of taxation. When the price of gambling is set by regulation above its competitive level, the economic losses created by excessive investment in the sector can be reduced by taxation. A turnover tax on the amount gambled can maximize both tax revenue and the economic welfare of the country. Due to administrative constraints, a number of countries rely on the taxation of the casinos’ fixed assets or a combination of a turnover tax and a tax on fixed costs. The model is applied to the situation in North Cyprus. The annual economic efficiency loss from its poorly designed tax policies on casino gambling is estimated to be about 0.5% of GDP.

Casino Taxation in the United States

This paper provides an overview of the forms of taxation that are applied to casinos by state and local governments, and analyzes those taxes and fees from a policy perspective. First, the paper co...

Legalized Casino Gambling and the Export Base Theory of Economic Growth

Gaming Law ReviewVol. 3, No. 2-3 Original ArticlesLegalized Casino Gambling and the Export Base Theory of Economic GrowthAssistant Professor Douglas M. WalkerAssistant Professor Douglas M. WalkerSearch for more papers by this authorPublished Online:12 Dec 2006https://doi.org/10.1089/glr.1999.3.157AboutSectionsPDF/EPUB Permissions & CitationsPermissionsDownload CitationsTrack CitationsAdd to favorites Back To Publication ShareShare onFacebookTwitterLinked InRedditEmail FiguresReferencesRelatedDetailsCited byTourism and hospitality market structure: A theoretical discussion5 February 2020 | The Social Science Journal, Vol. 149Inbound Tourism, Hospitality Business, and Market Structure23 August 2019 | Journal of Hospitality & Tourism Research, Vol. 43, No. 8A Trade Based View on Casino Taxation: Market Conditions25 August 2013 | Journal of Gambling Studies, Vol. 31, No. 2Market structure and casino taxation in tourist resorts4 February 2014 | Applied Economics, Vol. 46, No. 10Casino tourism, social cost and tax effectsInternational Gambling Studies, Vol. 13, No. 2Misconceptions About Casinos and Economic Growth4 April 2013Casino Taxation in Macao: An Economic Perspective6 January 2011 | Journal of Gambling Studies, Vol. 27, No. 4Casino Gambling Among Older Adults in North Dakota: A Policy Analysis26 June 2008 | Journal of Gambling Studies, Vol. 24, No. 4Estimating the impacts of crossborder competition: the case of gambling in Israel and EgyptTourism Management, Vol. 22, No. 5 Volume 3Issue 2-3Apr 1999 InformationCopyright 1999, Mary Ann Liebert, Inc.To cite this article:Assistant Professor Douglas M. Walker.Legalized Casino Gambling and the Export Base Theory of Economic Growth.Gaming Law Review.Apr 1999.157-163.http://doi.org/10.1089/glr.1999.3.157Published in Volume: 3 Issue 2-3: December 12, 2006PDF download