Circular a help card for casinos
Circular a help card for casinos
After a casino decree was issued earlier this year, a corresponding circular has recently been released to guide casino operators in their implementation, considering factors such as taxation, regulatory oversight, and the allowance local gamblers.
Back in late January, the government issued the long-awaiting casino Decree No. 03/2017/ND-CP. Although the issuance of the casino decree after almost 10 years of waiting has opened doors to the lucrative casino industry, foreign investors have been very hesitant about making their entry, and instead are laying low, awaiting further clarification from relevant authorities.
More than six months after Decree 03’s effective date, on October 5, the Ministry of Finance issued Circular No. 102/2007/TT-BTC guiding the decree. The new circular helps to complete the regulatory framework for casino business in Vietnam, giving the young industry a much-needed push.
Locals throw the dice
Local Vietnamese will be permitted to gamble at specific casinos approved by competent authorities on a three-year trial basis, calculated from the first opening day of the authorised resort. According to the media, only two casinos are currently implementing the three-year pilot scheme to allow Vietnamese gamblers. One is located within Phu Quoc district in Kien Giang province in southern Vietnam, and the other is located in Van Don district in Quang Ninh province in the north. There is also a small likelihood that the casino in The Grand Ho Tram Strip will join the list.
Local players are only permitted to enter casinos if they are at least 21 years old, they earn a monthly salary of at least VND10 million ($454), they pay an entrance fee of VND1 million ($45) for 24 hours or VND25 million ($1,136) per month, and have no outstanding objections in writing from siblings, spouses, parents, or other family members. These conditions however – especially the monthly income requirement – are complicated to prove and were not delineated in Decree 03. The circular further details the requirements. Local gamblers must have:
- Documents (tax declarations or a confirmation from tax authorities) proving taxable income at level three or above pursuant to the Law on Personal Income Tax;
- A notarised house or assets lease contract, where the total monthly rent is VND10 million or above;
- A notarised bank savings book or bank statement with a term of one year or more showing no less than VND10 million;
- Other documents proving that their usual monthly income is VND10 million or above;
- Or, in cases where a single document is not sufficient to prove the player’s monthly income, they can submit several documents to prove that their earnings are at or above the required threshold.
Casino taxation
Casino-operating enterprises must arrange an appropriate area on their premises for state authorities to perform management and surveillance activities either directly or via electronic equipment and camera systems. Transactions under supervision include both monetary transactions and ones involving tokens that are used in lieu of currency. These transactions must be recorded and reported to relevant tax authorities.
In addition, state authorities will also supervise – either directly or via electronic and camera systems – the calculation of transactions performed at cashier areas where tokens and bills are counted and stored.
Currency tokenisation
Casino-operating enterprises must exchange VND or other currencies for tokens and vice versa when players cash out.
The exchange rates between tokens and currency must be based on the daily rates of the licensed bank where the casino’s specialised foreign currency account is opened. Regarding weekends and bank holidays, the exchange rates will be based on the previous day’s rates.
A casino-operating enterprise may accept bank cards, but all transactions must be in VND.
If Vietnamese players win, they are only allowed to receive their winnings in VND – whether in cash or by bank transfer.
This is not the case for foreign players, who are allowed to receive winnings in foreign currencies.
What it all means
The issuance of Decree 03 and Circular 102 will help Vietnam’s young casino industry to attract foreign investment while limiting foreign currency losses to casinos in neighbouring countries. According to recent statistics, Vietnam loses about $800 million in tax revenue annually from players who cross the border to gamble in Cambodia. Additionally, many places in the region already allow casino business, such as Macau, Singapore, the Philippines, South Korea, and Japan.
In this context, Vietnam still has a lot to do in order to not only retain Vietnamese players in the market, but also to attract foreign players who are already familiar with other regional casinos.
