Macau Gaming Tax Revenue Close to $2B in Just Two Months
LISTEN TO THIS ARTICLE:According to the latest data released by Macau's Financial Services Bureau on Friday, the city's gambling market continues to gain strength. The government has garnered almost MOP14.8 billion (US$1.84 billion) in revenue from gaming taxes during the first two months of 2024.
Banking on Macau's Casinos
Compared to the same period last year, the total revenue from gaming tax revenue has surged by 142.9% since the start of the year. Looking only at February, the government's revenue from gaming taxes amounted to around MOP7.46 billion (US$925 million). This marked a 1.6% increase compared to the previous month.
Related: Macau Casino Tax Revenue Continues to Reach New HeightsUnder Macau's 10-year gaming concession plan, which started at the beginning of last year, the effective tax rate on gross gaming revenue (GGR) stands at 40%. It's important to note that the figures for tax revenue and casino GGR in a given period don't always line up. This is because there's a delay between the recording of GGR in Macau's casinos and the registration of tax payments by the Macau government.
The Macau government, in its budget plan for 2024, predicts that gaming tax revenue will reach almost MOP83.61 billion (US$10.36 billion) for the year. In the entirety of 2023, Macau authorities collected MOP65.26 billion (US$8.1 billion) in gaming tax revenue, exceeding the amount it had budgeted for the year by 28.3%.
Analysts Show Greater Optimism
Fitch Ratings has projected that Macau's economy will experience year-on-year growth of approximately 15% in 2024. This projection hinges on the assumption that the city's casino GGR will recover to 79.5% of its 2019 level, compared to 62.6% of the pre-COVID-19 figure witnessed in 2023.
Fitch also reaffirmed Macau's long-term foreign-currency issuer default rating (IDR) at 'AA' with a stable outlook. This was assigned based on the city's notably robust financial stability, as well as its proven fiscal responsibility. The company also said that Macau's budget could see its first significant surplus since 2020.
The Macau government expects a fiscal surplus for 2024 and has estimated that the city's casino GGR will reach MOP216 billion (US$26.8 billion) for the year. Fitch pointed out that the Macau government has presented a conservative surplus of 0.3% for this year, but said that gaming revenue could exceed the budget assumption by 7.6%. At the same time, Fitch doesn't expect any significant expenditures beyond the budget limits, similar to what Macau has reported in previous years.
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