Gaming house operators are prepared to challenge the government on its sliding scale tax all the way to the Privy Council, their attorney Wayne Munroe, QC, said yesterday.
“Those are my instructions,” he said.
“If it takes 10, 20 years, my clients are in it for the long haul. It is a matter of respect. How do you justify taxing your people and you are not taxing the foreigners who patronize casinos?”
Munroe said his clients are prepared to fight the sliding scale tax unless the government decides to also impose a similar tax on casinos.
“It is unfair,” he said. “Our clients only cater to Bahamians.”
Munroe, who represents three gaming operators, and attorney Alfred Sears, QC, who represents Island Luck, will meet with Attorney General Carl Bethel and his technical team this Thursday to discuss the patron tax.
Munroe said the sliding scale tax is not on the agenda.
He said Bethel feels confident that the sliding scale tax has strong legal footing.
In the Senate last week, Bethel said the government will impose the sliding scale tax on gaming house operators “in short order”.
He tabled the Gaming House Operator (Amendment Number 2) Regulations, 2018, which changes a phrase included in the original amendment.
During the budget communication in May, the government announced a sliding scale tax on gaming house revenues.
The previous gaming tax was 11 percent of gaming house revenues.
The government also announced that it would tax gaming patrons through a five percent stamp tax applied on deposits and any non-online games or digital sales.
In August, web shop operators filed an application in the Supreme Court seeking leave for judicial review of the government’s stamp tax on gaming patrons and the sliding scale gaming tax. They also sought an injunction against the taxes.
Following the application, the government agreed not to impose the taxes but rather seek to have further discussions with gaming house operators in a bid to iron out areas in dispute.
Web shop operators have labeled the taxes discriminatory, unfair and wrong.
Gaming operators said the increase in taxes would cause them to lay off employees and shut down locations.
In the government’s recent Fiscal Strategy Report 2018, it says, “The recent litigation launched against the government by the operators of the gaming houses poses some measure of threat to revenues, as budgeted.
“However, the government believes that it is on solid ground as to the legality and feasibility of the new tax measures announced in the May budget.”
The government has projected that it will collect $70 million in gaming taxes for 2018/2019. It collected $37.2 million in gaming taxes in the 2017/2018 fiscal period.