South Korean Casino Association Urges Government to Withdraw Proposed Levy Increase and Five-Year License Renewal Plan

The Korea Casino Association has urged the South Korean government to reconsider proposed regulatory changes that would increase the ceiling on tourism fund contributions for foreigner-only casinos and introduce mandatory five-year casino license renewals.

In a statement released on July 22, the association warned that the proposed measures could undermine the financial health of casino operators, discourage long-term investment and put jobs at risk at a time when competition from neighboring markets continues to grow.

At the center of the debate is a proposal by South Korea’s Ministry of Culture, Sports and Tourism to raise the statutory maximum contribution to the Tourism Promotion and Development Fund from 10 percent to 15 percent of casino sales.

The association argued that the contribution system already places a significant burden on operators because payments are calculated based on gross revenue rather than operating profit. As a result, casinos are required to make contributions even during periods when they are operating at a loss. In addition to these payments, operators are also responsible for individual consumption tax, corporate tax, local taxes and various other statutory charges.

According to the association, increasing the contribution ceiling would risk disrupting the sector’s ongoing recovery from the COVID-19 pandemic. It warned that higher financial obligations could weaken operators’ credit ratings and force companies to reduce or abandon major investment projects.

The association also pointed to intensifying regional competition, highlighting the planned opening of the MGM Osaka integrated resort in 2030 as a significant challenge for South Korea’s foreigner-only casino industry. It argued that domestic operators require sustained investment to remain competitive in attracting international visitors.

Separately, the association objected to the proposal requiring casinos to renew their operating licenses every five years. Since 1994, South Korean casinos have operated without fixed license terms, although current legislation already gives regulators the authority to suspend or revoke licenses in cases of legal or regulatory violations.

The association said introducing periodic renewals would create additional regulatory uncertainty while making it more difficult for operators to secure financing. It argued that this uncertainty could negatively affect large-scale integrated resort developments and employment throughout the sector.

The Ministry of Culture, Sports and Tourism defended the proposed reforms, noting that the foreigner-only casino industry has experienced substantial growth since the Tourism Promotion and Development Fund contribution system was established in 1995. According to the ministry, total industry revenue has increased by 10.3 times during that period, while average revenue per casino operator has grown by 7.8 times, even though the contribution framework has remained unchanged for approximately three decades.

However, the ministry clarified that the proposed 15 percent contribution rate would not apply across all casino revenue. Instead, the higher rate would be introduced only for a new revenue bracket that has yet to be determined and would affect only a portion of the revenue generated by higher-performing casino properties.

The ministry also dismissed reports suggesting that three of the country's largest casino operators would collectively face around KRW90 billion (US$60.8 million) in additional annual contributions. It said those estimates were based on the incorrect assumption that the proposed 15 percent rate would be applied broadly to casino revenues.

Officials added that both the revenue threshold and the applicable contribution rate for the new bracket will be finalized through amendments to the enforcement decree after consultations with representatives of the casino industry, academics and other relevant experts.

The proposed amendments are scheduled to be discussed during a National Assembly forum on July 23.

By fLEXI tEAM