LDP panel plans tax-free casino winnings for nonresident gamblers in Japan

Thursday 3rd December 2020

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In a bid to attract more overseas gamblers, the chief of the ruling Liberal Democratic Party panel said Thursday that winnings by nonresident foreigners at Japanese casino resorts will not be taxed.

Although such resorts have yet to be established in Japan, it is hoped the envisaged tax exemption will provide impetus for operators to plan "integrated casino resort" projects -- complexes that incorporate casinos, hotels, conference rooms and shopping malls -- which the government is keen to promote.

Prime Minister Yoshihide Suga promoted the introduction of the casino resorts while in the role of chief Cabinet secretary under his predecessor Shinzo Abe, hoping to attract more foreign tourists to invigorate the economy in the wake of the Tokyo Olympics and Paralympics.

"It would be meaningless if no one comes to the integrated resorts after building them," Akira Amari, head of the LDP's Research Commission on the Tax System, told reporters after a closed-door meeting. He added that the casinos must be "on a par with international standards."

The plan will be included in a tax reform package for fiscal 2021, which is expected to be compiled by the LDP and its junior coalition partner Komeito party on Dec. 10.

Under current arrangements, winnings at the casinos would be taxed in the same way as money won through bets on horse racing. For residents in Japan, taxes will be imposed based on the winnings they declare, according to Amari.

Under more liberal gambling laws enacted in 2018, the government will accept formal applications over a seven-month period from October next year from municipalities bidding to win one of three available integrated casino resort licenses. The complexes are expected to start operating in the mid-2020s.

The government had originally planned to start the bid procedure in January 2021, but decided in October to postpone the window for nine months citing the impact of the COVID-19 pandemic. So far, Yokohama (Suga's constituency), the city of Osaka, Osaka Prefecture, Wakayama Prefecture and Nagasaki Prefecture have declared that they intend to bid.

Tsukasa Akimoto, a 49-year-old House of Representative member formerly of the Liberal Democratic Party who headed Japan's legalization of casino resorts, was indicted earlier this year on charges of receiving some ¥7.6 million in bribes in relation to a Chinese gambling operator lobbying for a casino license in Japan and asking advisers from the firm to commit perjury in relation to the scandal.

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