North’s casinos ‘to have their tax bills halved’
Casinos in the north will have their tax bills halved after the passing of a new law, Turkish Cypriot opposition party ‘MP’ Erkut Sahali said on Thursday.
Sahali sits on the north’s ‘parliamentary’ finance committee and explained to the Cyprus Mail that ‘parliament’ had on Monday approved a twofold reform on taxes levied on casinos.
The first pertains to an increase in the rates paid by casinos based on the number of tables and slot machines they own. Monday’s law change saw a 17 per cent increase in these rates, meaning casinos will now pay 17 per cent more on this particular tax.
However, at the same time, the gaming services tax was cut from 10 per cent to five per cent.
This tax, as Sahali explained, is payable on the gross income earned by a casino, calculated after deducting the winnings given to successful gamblers.
He said, “this is where the real change was made, because this tax was levied at a rate of 10 per cent before Monday.”
According to the law, casinos cannot pay less income tax than what they pay in gaming services tax, but the north’s ‘government’ says it has no real way of determining how much revenues casinos generate other than from figures provided by the casinos themselves.
Therefore, as Sahali said, “they believe they have to accept whatever the casinos say as truth. However, the government also knows, and casinos are openly saying, that they earn much more in profits and gross income than they declare.
“For this reason, the government thinks that by halving the rate of its gaming services tax, casinos will have to report twice the gross income to pay the same amount of tax, thus increasing the amount of money recorded.”
However, he said, “this idea is in no way compatible with reality.”
“Currently, 14 of the 31 active casinos pay more taxes than the minimum tax rate they can pay. Some even pay four times more tax than the minimum. Therefore, since the tax rate has been cut in half, the amount of tax paid by 14 taxes will also be cut in half,” he said.
In short, he said, “the tax paid by casinos which pay more taxes than the minimum will now be less than it was before the law was changed.”
Sahali’s reading of matters is disputed by ‘finance minister’ Ozdemir Berova, who had described Sahali and other CTP ‘MPs’ as “masters of distortion” in ‘parliament’ on Monday.
The Cyprus Mail contacted Ozdemir Berova for comment on the matter.