South Korea Casino Group Flags Risks From Tourism Levy Proposal
Written by Jakob Schmitt · Jul 25, 2026
South Korea Casino Group Flags Risks From Tourism Levy Proposal
The Korea Casino Association, which represents the country’s foreigner-only casino operators, issued a direct warning in July 2026 about a government plan to raise the mandatory contribution to the Tourism Promotion and Development Fund. The proposal would lift the upper limit on that levy from 10 percent to 15 percent of revenue, and the association stated that such an increase would accelerate bankruptcies among properties still working to recover from the pandemic period.
Under the current framework the levy applies to gross revenue regardless of whether an operator records a profit or a loss. Association representatives noted that roughly half of the member casinos have posted annual deficits in each of the past ten years, which means the charge functions as an additional fixed cost layered on top of existing corporate taxes and other regulatory fees. Those costs, they argued, already place South Korean venues at a disadvantage when compared with integrated resorts in neighboring jurisdictions that operate under lighter contribution requirements.
Details of the Proposed Changes
The draft legislation also introduces five-year license renewal cycles and requires prior government approval for any significant change in ownership structure. Officials have indicated that the new rules aim to strengthen oversight while directing more resources toward tourism infrastructure. The Tourism Promotion and Development Fund collected a record KRW219.5 billion from casino operators in 2025, an amount 61.7 percent higher than the total recorded in 2019.
Because the levy is calculated on revenue rather than profit, loss-making properties still remit teh full percentage even when their balance sheets remain in the red. The association’s statement emphasized that this structure leaves little room for operators to rebuild reserves or fund necessary capital improvements after the extended COVID-19 downturn.
Competitive Position and Regional Comparisons
Operators point out that several regional markets have either reduced or capped similar tourism levies in recent years to attract international visitors. South Korea’s foreigner-only casinos rely heavily on inbound tourism, and any widening of the cost gap could shift player spending toward venues in Macau, Singapore, or Japan where contribution rates sit at lower effective levels. The association did not release specific competitor figures in its July 2026 statement, yet it stressed that the cumulative tax and levy burden already exceeds that faced by many overseas properties.
Historical Collection Trends and Operator Performance
Fund data shows steady growth in collections even before the pandemic, with the 2025 total marking the highest single-year figure on record. Association members maintain that this upward trajectory occurred while many properties continued to post losses, illustrating the disconnect between revenue-based charges and actual financial health. Over the ten-year window referenced in the warning, the proportion of deficit operators remained near 50 percent in most years, suggesting structural challenges that predate both COVID-19 and the current proposal.
License renewal provisions within the same bill would shorten the current approval period to five years and add an explicit review step for major ownership transfers. Industry observers note that these clauses could increase administrative costs and introduce greater uncertainty for investors considering long-term commitments in the sector.
Association Position and Government Objectives
The Korea Casino Association framed its warning around the risk of accelerated closures rather than outright opposition to tourism funding. Representatives argued that a phased or profit-linked adjustment would better align contributions with operators’ ability to pay while still supporting the fund’s goals. Government documents released alongside the draft bill highlight the record 2025 collections and the need for additional resources to promote post-pandemic tourism recovery.
Because the levy applies uniformly, smaller or newer properties that have not yet reached consistent profitability face the same percentage obligation as larger, established venues. This uniformity, according to the association, amplifies pressure on the segment of the market most vulnerable to further cost increases.
Conclusion
The July 2026 proposal to raise the tourism levy ceiling to 15 percent of revenue has prompted a clear response from the Korea Casino Association, which cited ongoing recovery challenges and the existing pattern of annual deficits among roughly half its members. The bill’s additional provisions on five-year license cycles and ownership approvals add further regulatory layers that operators say will compound financial strain. Collection figures reached KRW219.5 billion in 2025, underscoring the fund’s growing reliance on casino contributions. The outcome of the legislative process will determine whether the current revenue-based structure remains in place or shifts toward a model that accounts for profitability differences across the sector.