The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The new web shop patron "winnings" tax is unlikely to come into effect until the New Year, the industry association's chief executive confirmed last night.

Gershan Major, head of The Bahamas Gaming Operators Association, told Tribune Business that the tax's implementation remains dependent on international testing laboratories certifying that the games offered by web shops deliver what they promise to customers after being adjusted for the new levy.

"The implementation of the patron tax is still dependent on all the operator moderations being completed and certified by the international testing laboratories," he explained. "Once that is done, and it is approved by the Gaming Board, that will happen."

Asked when the patron "winnings" levy will take effect, Mr Major replied: "I suspect some time in 2020." The new winnings tax, when it eventually comes into effect, will see five percent paid on winnings up to $1,000 and 7.5 percent on anything greater than $1,000.

Dionisio D'Aguilar, minister of tourism and aviation, told the House of Assembly earlier this year that just 45 percent of web shop gaming activities will attract the new patron "winnings" tax with online casino spins remaining untouched "for now".

He added that the Government had decided to focus this levy solely on lottery/numbers operations because it was too "complicated" to calculate the winnings from online casino spinning.

Mr D'Aguilar said this "small tax on winnings" was projected to yield between $10m-$15m annually for the Public Treasury and help take the government closer to the $50m total web shop revenue target it had envisioned under the initial tax structure for the industry.

He indicated that Bahamian gamblers had got off relatively lightly, as the comparable winnings tax rates in Jamaica and Barbados are 15 percent and 20 percent, respectively. In the US, he added that the federal tax rate was 25 percent, with state and local taxes on top of that.

Sebas Bastian, Island Luck's principal, previously told Tribune Business that the patron "winnings" tax was "a wild card" for the Bahamian web shop industry given that it was difficult to predict how customers will react to the levy.

"The patron lotto winning tax is going to be a wild card, though such a tax exists in many other regulated gaming jurisdictions," the Island Luck chief said.

"This winning tax is new to this gaming culture, so we can predict if player payout is less, that player has less to re-bet with. At the end of the day the new Bill's changes seem to correct some errors that were made in the previous tax methodology and assumptions."

Mr Major last night confirmed that the revised taxation structure to be paid by web shop operators has gone into effect. All licensed gaming operators pay 15 percent on their first $0 to $24m of revenue, and operators earning anything greater than $24m will pay 17.5 percent on sums above that threshold.