Macau to See 80% Drop in Tax Revenue as Junkets Exit

With casino junkets possibly looking at the end of their run in Macau, the revenue they once provided will be dramatically reduced. The government anticipates an almost 80% loss from the segment in fiscal year 2022. Junkets have been a regular part of Macau’s gambling industry for years, but that abruptly changed late last year. There had already been talk of junkets losing favor last year. The legal debacle surrounding former Suncity boss Alvin Chau accelerated the issue. Analysts predicted that the loss of the junkets would impact the city more than casinos, and that assertion has been confirmed. When Macau’s Financial Services Bureau (FSB) published the new budget plan for fiscal year 2022, it spelled out how much that impact will be. The FSB’s report shows that the city will pick up around MOP43 million (US$5.35 million) in tax revenue from the money casinos pay to junkets through commissions. That amounts to 79.5% less than it estimates will have been collected when the final numbers for fiscal year 2021 are provided. Macau has constantly revised its budget figures the past couple of years, thanks to COVID-19. For 2020, casino revenue plummeted as the gambling properties were shuttered for months at a time. By the end of that fiscal year, the city had lost millions in tax revenue from gambling. It also took in just MOP66.54 million (US$8.27 million) in tax revenue from the junket commissions. This was 68% lower than what it had projected at the start of the 2020 fiscal year. More Losses Could be Coming Junket operations in Macau have been slipping for years. In 2013, there were 235 licensed junkets. This dropped to around 100 in 2019. By the beginning of 2021, there were only 85.

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