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The plan to tax the winnings of gambling players at 30%, which will be examined by the second chamber of Parliament next December, does not arouse great enthusiasm among casino operators who believe that this provision will be detrimental to the whole of Morocco’s tourism ecosystem. Explanations.
“A dead loss of at least 30% of usual players”
“We estimate that a minimum of 30% of our usual players, both Moroccans and foreigners, will no longer return to the 7 casinos of the Kingdom and that they will prefer to spend their money Spain, Egypt, Cyprus or Malta who will be happy to be able to delight tourists in Morocco”, several operators tell us, reminding us that these countries do not tax players’ winnings.
Indeed, several major tourist destinations, like the Portugalwhich had imposed this measure in the recent past had to finally backtrack, after noting a disaffection among their customers leading to a drop in their foreign exchange and tax revenues.
A measure imposed without any consultation with the profession
Willing to participate in the tax effort, our interlocutors reveal that the profession, already subject to strict specifications in terms of tax obligations, would have preferred to be taxed rather than scare away its customers and encourage illegal games in illegal gambling dens.
To avoid depriving Morocco of a lucrative and rapidly developing market, logic would have, according to them, dictated to directly tax casino operators up to 5% of their gross income, which amount to approximately one billion dirhams per year already subject to the gaming tax paid to the municipalities where they are domiciled and to a VAT of 20%.
The profession predicts a negative impact on the entire ecosystem and on tax revenues
“Faced with an inevitable drop in the number of its customers, the sector will have to rethink its strategy in Morocco and if there will be no closure, staff cuts cannot be ruled out, knowing that casinos directly and indirectly employ tens of thousands of people. Our sources add that other hoteliers will also be affected, because a fifteen big casino customers are invited every day to other luxury establishments.
And to predict that the authorities will realize after six months of application of this law that revenues from casinos will drop and that this will mean fewer taxes to be collected for the state coffers, with consequences on all operators in the tourism ecosystem.
“No new operator will want to invest in Morocco”
Having not been consulted during the preparation of this law, concocted by the ministry in charge of Budgetoperators claim that this “crippling impact” provision will also discourage potential investors in the sector.
“It is obvious that the possible adoption of this measure will not allow Morocco to become a major global casino destination, because no new investor will want to come and open an establishment, knowing that competition abroad is much more attractive in in terms of taxation”, estimate our sources. They specify that the priority of investors is to retain their customers who earn much less than what they lose, and not to scare them away with profits reduced by 30%.
Saying they are ready to compromise, the operators believe that the ministry in charge of the Budget must listen to their grievances, under penalty of calling into question the current development dynamic which aims to make Morocco, by 2030, a of the 15 global tourism destinations.
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