Korea Casino Association Warns Proposed Levy Hike Could Accelerate Financial Strain for Foreigner-Only Operators

teh Korea Casino Association, which represents South Korea’s foreigner-only casino operators, released a statement in July 2026 highlighting risks tied to a government proposal that would raise the mandatory tourism levy from its current maximum of 10 percent to 15 percent of revenue. Association representatives noted that such an adjustment arrives while many facilities continue their post-pandemic recovery, and they argued the change could hasten bankruptcy proceedings for venues already operating under tight margins. The group pointed out that casinos in this category face taxation based on revenue rather than profit, a structure that applies even during periods when facilities record losses. Data from the tourism fund shows collections reached KRW219.5 billion in 2025, a figure that represents a 61.7 percent increase compared with 2019 levels. Association leaders referenced these record collections while questioning the necessity of the proposed increase, and they suggested the additional burden would reduce funds available for operational improvements and debt servicing. Observers note that the levy functions as a direct percentage of gross revenue, which means operators cannot offset the charge against expenses or investment requirements during slower periods.

Taxation Structure and Revenue Collection Trends

Casino operators in South Korea’s foreigner-only segment pay taxes calculated on total revenue regardless of net profitability, a rule the association described as unique among major industries. This approach means facilities that experience high fixed costs or seasonal downturns still remit substantial amounts to the tourism fund. The Korea Casino Association emphasized that the existing 10 percent cap already places operators at a disadvantage when compared with regional competitors who face different fiscal frameworks, and they warned that moving the rate to 15 percent would compound those pressures during a time when visitor numbers have not fully returned to pre-pandemic patterns.

Figures released by tourism authorities confirm steady growth in fund collections through 2025, yet association statements stressed that these gains have not translated into improved cash flow for individual casinos. Operators must allocate resources toward marketing, staff retention, and facility maintenance while meeting the levy obligation, and any increase would further limit flexibility. The group cited examples of venues that have restructured debt or delayed expansion projects since the COVID-19 downturn, and they indicated additional revenue extraction could push several properties toward insolvency proceedings.

Broader Regulatory Proposals Under Review

Alongside the levy adjustment, authorities have floated plans to limit license renewals to five-year terms and to introduce stricter ownership regulations. The Korea Casino Association argued these measures would reduce long-term planning certainty and make it harder for operators to attract international investment. Regional rivals in nearby jurisdictions often provide longer license durations and more flexible ownership structures, which the association said creates an uneven competitive environment for South Korean properties seeking to draw high-value visitors from overseas.

Association representatives pointed out that five-year renewal cycles would require frequent compliance reviews and capital commitments, potentially diverting resources from customer-facing enhancements. They also noted that tighter ownership rules could limit partnerships with established international gaming groups that have experience navigating post-pandemic market shifts. Data on tourism fund performance shows continued expansion, yet the association maintained that casino-level economics remain fragile enough to warrant caution before implementing additional fiscal or regulatory changes.

Industry Recovery Context Since the Pandemic

Foreigner-only casinos in South Korea experienced sharp revenue declines during the COVID-19 period when international travel restrictions reduced visitor arrivals to historic lows. Recovery has progressed unevenly, with some properties reporting improved footfall by 2025 while others continue to manage elevated debt loads from the closure period. The association’s warning referenced these ongoing challenges and underscored that taxation on revenue, rather than profit, prevents operators from using loss years to reduce their overall tax exposure.

Industry reports indicate that several facilities have focused on cost control and selective marketing to overseas markets since borders reopened. The proposed levy increase would apply uniformly across the sector, regardless of individual property performance, and association statements suggested this could accelerate consolidation or closure decisions among weaker operators. Tourism fund collections have risen substantially, yet the group maintained that the casinos generating those collections require stable conditions to sustain contributions over the long term.

Conclusion

The Korea Casino Association’s July 2026 statement outlines specific concerns about the tourism levy proposal, the existing revenue-based taxation model, and additional regulatory adjustments related to licensing and ownership. The group referenced KRW219.5 billion in 2025 collections alongside comparisons to 2019 figures and highlighted competitive pressures from other Asian gaming markets. Authorities have not yet finalized the changes, and the association’s position centers on preserving operational viability for the foreigner-only segment during its continued recovery phase. Further details on the proposal timeline remain under review by relevant government bodies.