NEWS | Wednesday, 11 June 2008

Gaming revenue jumps 7% - LGA

Charlot Zahra

Total revenues for the gaming sector in Malta last year registered another positive year, with an increase of €2.106 million or 6.82 per cent over the previous year.
According to figures issued by the Lotteries and Gaming Authority (LGA), which regulates gaming in Malta, last year the gaming sector registered total revenues of €32.990 million as against €30.884 million in 2006.
In the remote gaming sector, last year there were 197 licensed companies in 2007, an increase of 126 licensed companies over the previous year, when there were 71 licensed companies.
The total income generated from this sector last year totalled €10,758,407 as against €8,657,028 in 2006, an increase of €2,101,379 or 24.27 per cent annually.
The revenue generated from the remote gaming sector last year includes €10,100,000 in duty and €658,407 in license fees as against €8,300,000 in duty and €357,350 in license fees in 2006, an increase of €1,800,000 and €301,379 respectively on an annual basis.
Remote gaming companies pay according to their classification: Class 1 licensees (online casino style games, slots and online lotteries) pay €4,658 a month for the first six months of operation, and €6,988 a month thereafter.
Class 2 licensees (Fixed Odds Betting) pay 0.5 per cent on gross betting. Under this category, betting exchanges are charged 0.5 per cent on net winnings, while pool betting is charged 0.5 per cent on stakes paid. All Class 2 licensees have an annual tax capping of €465,875.
Class 3 licensees (Poker, Betting Exchange, Tournaments, Bingo) pay 0.5 per cent on real income.
Class 4 licensees (the software vendors which provide the gaming platform) are tax exempt for the first six months, then pay €2,329 a month for the next six months, and €4,658 a month thereafter.
Class 1 licensees which operate a platform which is also licensed in Malta (Class 4) pay €1,164 a month, while Class 3 licensees which operate a platform which is also licensed in Malta (Class 4) pay 5 per cent on real income.
In the casinos sector, last year the amount of licensed casinos remained the same, four, however the revenue generated from them increased from €9 986 350 in 2006 to €10,632,937 last year, an increase of €646,587 or 6.47 per cent.
The revenue generated from the casinos sector last year includes €10,400,000 in duty and €232,937 in license fees as against €9,800,000 in duty and €186,350 in license fees in 2006, an increase of €600,000 and €46,587 respectively.
Casinos pay an annual license fee of €46,587 each and a fixed percentage on turnover as duty as follows: 40 per cent on gross turnover on slot machines, 36 per cent on gross turnover on table games.
In the case of junket markets, the duty paid is 15 per cent on gross turnover on slot machines and 7.5 per cent on gross turnover on table games.
Junket is an arrangement between the casino and the junket leader to induce foreign gamblers (mainly from Italy) to come to a Maltese licensed casino for the purpose of gambling and in return the casino licensee directly pays any or all of the transportation costs, food, lodging and entertainment.
Such an initiative attracts foreign investment not just to boost the casino’s income from foreigners but also on a wider spectrum the tourism in general, therefore they pay less than ordinary casinos.
Also in the bingo halls sector the number of licensees stood at four, same as the previous year. The revenue generated from them also increased, on their part from €793,967 in 2006 to €832,439 last year, an increase of €38,472 or 4.85 per cent.
The revenue generated from the bingo halls sector last year includes €713,641 in duty and €118,798 in license fees as against €700,792 in duty and €93,175 in license fees in 2006, an increase of €12,849 and €25,623 respectively.
Bingo halls pay an annual license fee of €2,329 and an annual duty of 10 per cent on gross turnover.
Finally, in the national lottery sector, last year the amount of licensed operators remained the same, one, however the revenue generated from them decreased from €11,446,587 in 2006 to €11,036,568 last year, a decrease of €410,019 or 3.58 per cent. This was the only gaming sector which registered a decrease in revenue last year.
The revenue generated from the national lottery sector last year includes €10,990,000 in duty and €46,568 in license fees as against €11,400,000 in duty and €46,587 in license fees in 2006, a decrease of €410,000 and €19 respectively.
Maltco Lotteries have an exclusive license to operate the National Lottery for a period of seven years. This license was awarded when the Public Lotto Department was privatised in 2004.
The National Lottery pays an annual license fee of €46,587 and a duty on each game as follows: 20 per cent on gross turnover on Lotto, Super 5; 25 per cent on net turnover on Keno, U*Bet; and 12.5 per cent on gross turnover on Scratchers.

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