Macau’s Financial Services Bureau reported a significant rise in gaming tax revenues for August, with a collection of MOP$7.16 billion (US$891 million). This figure represents a 4.8% increase from the previous month and an impressive 11% growth over August 2023, where the tax revenue was MOP$6.44 billion (US$799 million). These figures illustrate the steady and robust growth in the gaming sector, which remains a cornerstone of Macau’s economic strategy.
Robust growth in gaming tax contributions:
The growth in August is linked directly to the gross gaming revenue (GGR) for July 2024, which also saw a substantial increase of 5.1% month-over-month to MOP$18.6 billion (US$2.31 billion). This sequential rise in GGR is a strong indicator of sustained consumer interest and investment in Macau’s gaming industry.
As Inside Asian Gaming reports, the cumulative gaming tax revenue from January to August 2024 reached MOP$58.8 billion (US$7.32 billion), marking a remarkable 50.2% increase compared to the same period in 2023. This performance has already achieved 70.3% of the government’s full-year target of MOP$83.6 billion (US$10.4 billion) set for FY24, underlining the sector’s significant contribution to the local economy.
Moreover, Macau’s total government revenue during the first eight months of 2024 stood at MOP$69.81 billion (US$8.69 billion), which is 68.3% of the government’s forecast total revenue of MOP$102.3 billion (US$12.7 billion) for the year. Importantly, gaming taxes constituted 84.6% of this total revenue, highlighting the gaming sector’s pivotal role in funding governmental operations and public services.
Challenges and analyst expectations:
Despite these positive trends, analysts remain cautious about the immediate future, particularly for September 2024. Predictions of limited growth in the upcoming month are partly due to typical seasonal slowdowns in the gaming industry. Additionally, recent typhoon activities have negatively impacted tourist visitations, potentially curtailing the usual influx of gamers that Macau relies on.
Under the revised gaming concession framework effective from January 1, 2023, the casinos in Macau are taxed at a 40% rate on GGR. It’s important to note that the relationship between the reported casino GGR and the tax figures collected in any given period can be complex. This complexity arises because there is usually a delay between when GGR is reported by the casinos and when the tax is registered by the government.
Looking forward to the remainder of 2024, the government anticipates that gaming tax revenue will continue to be a major fiscal driver, projecting to reach MOP83.61 billion (US$10.49 billion) by year-end. The collections from January to August suggest that this target is well within reach, setting the stage for potentially exceeding the planned figures if the current trends continue.
In contrast, the fiscal performance in 2023 saw gaming tax revenues surpassing the budget expectations significantly, with a total collection of MOP65.26 billion (US$8.19 billion), which was 28.3% above the budget. This previous overachievement provides a cushion and a precedent for optimistic fiscal planning and execution in Macau.
