JAPAN HAS DECIDED NOT TO TAX THE WINNINGS OF FOREIGNERS!
Japan has decided not to tax the winnings of the non-resident foreigners at casinos in the country to attract more overseas gamblers.
Japan’s ruling Liberal Democratic Party Research Commission on the Tax System panel head Akira Amari has made it clear earlier this week that lawmakers are considering eliminating the so-called withholding tax on casino winnings.
The step was confirmed earlier today by Mr. Amari. He said Japan’s central government fears that the introduction of a withholding tax will frighten foreign gamblers when the country’s first Macau-style casino resorts finally open their doors.
Then Mr.Amari specified that it would be senseless if no one came to the integrated resorts after building them and the casinos needed to be on par with international standards.
Japan legalized casino gambling in late 2016. Under national gambling laws, casinos can only operate as part of larger integrated resorts, which also include big hotels, conference rooms, and commercial space, as well as other amenities.
The central government of Japan plans to issue up to three licenses for three casino resorts in different parts of the country.
Those who supported the legalization of casino gambling in a bid to attract more foreign tourists were former Japanese Prime Minister Shinzo Abe and his successor, Yoshihide Suga, who long served as chief Cabinet secretary during his predecessor.
The plan to abolish the previously proposed tax on casino winnings will be included in the tax reform package for the fiscal year 2021. The package must be composed and submitted by the ruling Liberal Democratic Party and its junior coalition partner by December 10.
Mr. Amari explained that according to the current rules, casino winnings are taxed the same as horse racing winnings. Japanese residents ‘ winnings will be taxed based on their claimed winnings amounts.
Tax on withholding winnings received by non-resident foreigners was first proposed in December 2019. According to the report, Japan would levy a tax on the difference between the value of chips bought by foreign players and the number of chips they convert back into cash. Japanese lawmakers said last year that such a tax system should facilitate any tax audits and investigations that might occur in the future.
The central government of Japan will start accepting applications for a casino license from October 1, 2021. Initially, the time frame of acceptance was planned on January 4, 2021, till July 30 of that year, but the Covid-19 pandemic forced lawmakers to push back the original deadline by nine months. Now companies can apply for a license Applications until April 28, 2022.