The Financial Services Bureau in Macau has announced the tax payments from the gaming industry for 2021. Last year, a total of MOP$33.91 billion ($4.22 billion) was paid by operators. This is an increase of 13.8% when compared to the MOP$29.81 billion ($3.73 billion) paid in 2020. While the amount is an increase from the previous year, it is a decline from the expected MOP$50 billion estimated by the government within the annual budget.
2021 Impact and 2022 Predictions
The Gaming Inspection and Coordination Bureau recently announced the gross gaming revenue totals for 2021, revealing MOP$86.86 billion ($10.82 billion) for the year. This is an increase of over 43% from 2020. However, it is down over 70% when compared to the 2019 earnings.
According to Inside Asian Gaming, there were several reasons why the gross gaming revenues were impacted negatively in 2021. Firstly, the ongoing border restrictions played a big role in lesser earnings. Players were unable to easily visit from mainland China, which cut back on the visitor total. In 2021, only 7.7 million people traveled to Macau which is a whopping 80% lower than the number from 2019.
The crackdown by China involving cross-border gambling activities also played a role. The changes made by the government saw the junket business of Suncity Group close after its CEO Alvin Chau was arrested late last year. In January, Levo Chan of Tak Chun was arrested, further showing the potential decline for the VIP sector in Macau.
For 2022, the annual budget is predicting that gaming tax will come in at MOP$49.76 billion ($61.93 billion). In January, the government collected over MOP$3 billion ($405 million) in taxes. This was an increase of 1.5% when compared to January 2021.
Chinese New Year Success
With the Chinese New Year finishing up not long ago, it proved to be a good week for Macau. The region saw over $289 million in gaming revenues, with a better-than-expected outcome. Revenues were down for quite some time, but it seems the holiday week helped to bring travelers back to the area.
According to analysts, the turnaround was due to strong mass-market volumes and higher VIP hold. It was an impressive turnout during the Chinese New Year especially due to the ongoing travel issues due to COVID-19 outbreaks in Zhuhai in China and Hong Kong.
It has been predicted that after the successful January, February may also see higher gross gaming revenues. As much as $1 billion in earnings may be generated once the month comes to an end in just a few days.