Korea Casino Association Warns of Potential Bankruptcies from Tourism Levy Increase
The Korea Casino Association, which represents South Korea’s foreigner-only casino operators, released a statement in July 2026 that outlined serious concerns over a proposed hike in the mandatory tourism levy. The group noted that raising the levy from its current maximum of 10 percent of revenue to 15 percent could accelerate financial strain on facilities still rebuilding after the COVID-19 pandemic. Casinos in this category already operate under a revenue-based tax structure that applies regardless of profit or loss, a point the association emphasized as distinctive compared with other sectors.
Details of the Proposed Changes
Under the suggested framework the tourism levy would climb to 15 percent of gross revenue, a shift that industry representatives argue would compound existing recovery challenges. The association pointed out that these operators pay taxes on revenue even during periods of negative earnings, a practice that sets them apart from standard corporate taxation models used elsewhere in the economy. Observers note that this structure leaves little flexibility when visitor numbers fluctuate, particularly after extended closures and travel restrictions tied to the pandemic years.
Record Tourism Fund Collections Cited
Data shared by the association shows the tourism fund collected KRW219.5 billion in 2025, representing a 61.7 percent increase from the 2019 total. Those figures indicate strong growth in contributions despite ongoing recovery efforts at individual properties. The association referenced these collections while questioning whether an additional increase in the levy rate would align with the fund’s stated purpose of supporting tourism infrastructure and promotion.
Proposals accompanying the levy adjustment include shortening license renewal periods to five years and introducing stricter ownership regulations. The association stated that these measures together could reduce the sector’s ability to compete with casinos in neighboring countries that maintain longer license terms and more flexible ownership structures. Regional rivals have continued to expand facilities and marketing programs, drawing international visitors who might otherwise consider South Korean destinations.
Context of Post-Pandemic Recovery
Foreign-only casinos in South Korea began reopening gradually after pandemic restrictions lifted, yet many facilities reported slower return of high-value international patrons. The association highlighted that revenue-based taxation continues during low-earning periods, which limits cash flow available for renovations, staff retention, and marketing campaigns aimed at restoring visitor numbers. Industry data indicates that several properties still operate below pre-2019 revenue levels even as overall tourism fund receipts reached new highs in 2025.
The group’s statement referenced ongoing discussions within regulatory circles about balancing tourism development goals with operator sustainability. According to the association, the combination of higher levies, shorter license terms, and tighter ownership rules risks discouraging new investment at a time when regional competition remains intense. Casinos in nearby jurisdictions have introduced expanded entertainment options and integrated resort features that attract the same pool of foreign visitors.
Industry Position on Competitiveness
Representatives from the Korea Casino Association argued that maintaining a stable regulatory environment supports long-term contributions to the tourism fund and local economies. They noted that current collections already demonstrate substantial operator contributions, and further rate increases could reduce overall funds generated if properties face closure or reduced operations. The association called for policy reviews that consider both fund growth and the financial health of facilities still navigating post-pandemic conditions.
Those who have followed the sector’s regulatory history point out that license duration and ownership rules directly influence capital allocation decisions by international operators. Five-year renewal cycles, if implemented, would require more frequent compliance reviews and could shorten planning horizons for major upgrades. Stricter ownership limitations might similarly restrict partnerships that have supported expansion in other Asian markets.
Conclusion
The Korea Casino Association’s July 2026 statement presents specific concerns about the proposed tourism levy increase to 15 percent of revenue, alongside related regulatory adjustments. The group cited revenue-based taxation, record fund collections of KRW219.5 billion in 2025, and competitive pressures from regional rivals as key factors in their assessment. Policy discussions on these measures continue, with the association urging consideration of impacts on operators recovering from pandemic-related disruptions. Additional information appears in coverage from industry reports tracking regulatory developments in the region.