A recent proposal looking into withholding taxes from any casino wins by a foreigner has been shut down – at least for now.

Getting Started

Casino gambling has technically been legal in Japan since 2016, when a bill was passed to legalize gambling. But things are moving very slowly. Originally, the newly established casino management commission was set to start reviewing license bids in January 2020 to see which cities would be allowed to start building their first casino resorts, but that has now been pushed till 2021.

Now it seems like another previously approved policy is also changing.

The original plan was always to lay out tax policy regarding casinos before the venues opened, so federal revenue agencies and gaming companies would know what to expect regarding numbers. But the idea encountered much opposition from various fronts. In an interview with broadcaster NHK, an unidentified LPD member commented that in going this route, “the burden on the business community will be considerable, and the tax proposal could reduce investment in Japan’s casinos.”

Talking Taxes

A plan to withhold taxes on winnings by non-residents isn’t so strange. In fact, countries like the U.S. and South Korea are already doing it. In the U.S., non-resident visitors are charged a 30 percent tax rate on their winnings right on the spot.

Japanese policymakers were looking at different ways of dealing with winnings, but the plan has been put on pause before they even got too far into it.

Times Are Changing

With Japan entering the casino market in the next few years, things are heating up. While many cities are fighting to grab one of the many licenses available, the Hokkaido prefecture recently retracted its initial bid, citing concerns on how the increase in tourism would affect the environment and well-being of the local residents.

There are also major concerns about pricing – Japan, a country well-known for sky-high property prices, will not come cheap to operators. The general estimate is that a high-end casino resort will cost $10 billion or more to build to the right standards.

Whether this will affect the taxes imposed on casinos and gamblers is yet to be seen, but there’s no doubt that the government is working to make sure everything is in place before handing out licenses for construction to start.

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A Massachusetts native, blogger Angeline Everett grew up in the Allston neighborhood of Boston and earned a degree in casino management from the University of Massachusetts-Amherst. After graduating, Angeline moved to Atlantic City where she joined the young team at the Borgata Casino as a compliance representative, while blogging on the side. After a few years in the back office, Angeline moved to the floor to work first at a casual poker dealer and later casual poker floor supervisor. Fascinated with games of chance since she was a child, Angeline currently divides her time between blogging and work on her first book.