The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamian casinos are currently earning just one-fifth of the annual revenue take enjoyed by their Las Vegas counterparts, Tribune Business was told last night, with proposed reforms having the potential to “quadruple” the industry’s income.

Responding to Tribune Business questions, Stuart Bowe, the Bahamas Hotel and Tourism Association’s (BHTA) president, said: “In reviewing the revenue take per casino against the top five gaming destinations in the world, Bahamian casinos average $48.6 million per casino.

“Conversely, Las Vegas casinos average $240.8 million per casino and Macau’s casinos average $1.076 billion per casino.”

The Bahamian hotel casino industry has proposed 17 wide-ranging reforms to make the industry more competitive against global rivals, which the Cabinet is now considering.

“We could quadruple our gaming revenue with the reforms and the opening of Genting in Bimini, Baha Mar, and revitalising Grand Bahama’s casino,” Mr Bowe told Tribune Business.

“Failing to do so will further impact gaming revenue but also affect hotel occupancies. Even if we increase room occupancy by 10 percent because of these reforms, it will have a considerable positive impact on tax revenues and tourist spend in our destination.”

He added: “Jurisdictions close to our shores who compete for the same games (such as New Jersey and Las Vegas) already had in place many of the recommendations we are advancing, or are now putting in place additional reforms which embrace the latest technologies similar to those which we have proposed. We need to move quickly to restore our competitive edge.”

In its proposed reforms, the BHTA is asking for the Government to exempt all imported gaming equipment from Customs and related tariffs.

This, it said, would “significantly increase gross gaming revenues and taxes from slot machines”, revealing that the daily average slot win per unit in Bahamian casinos was currently “less than half that of Las Vegas and Atlantic City”.

This was because Bahamian casinos typically offered older slot machines, due to the “difficulty and expense associated with replacing unprofitable games”.

The proposals also include allowing patrons to gamble online at Bahamian casinos from anywhere in the world, provided their home jurisdictions allow mobile gaming.

This is seen as creating an expanded customer base, generating more revenues and taxes, while also creating “high-tech Bahamian jobs” and eliminating the “seasonality” associated with the nation’s tourism product.

The ‘junket’ definition would also be expanded to an aggregate value of $100,000 or more per group of 20 players, as the current wording - eight or more people at a cost of $250 per person - “does not reflect the cost of doing business”.

The BHTA proposals also provide mechanisms to enforce the collection of gambling debts, and resolve disputes with patrons.

And, in permitting permanent residents and work permit holders to gamble in Bahamian casinos, the BHTA is proposing that these persons pay “an entry levy” to the Government.

“In Singapore, residents must buy a daily pass for $100 or yearly pass for $2,000 for casino entry, limiting access to those with financial means,” the BHTA proposal said.

Mr Bowe said the private sector’s proposals should be viewed as a “package” with all equally important as each other.

“In our extensive review of policies, regulations and offerings by the world’s most successful gaming destinations it was clear to us that comprehensive reform is necessary to be competitive,” the BHTA president said.

“In reviewing data on 80 casino operations globally, as a jurisdiction the Bahamas ranks at the bottom in revenue per casino, outpaced by places like Singapore, Macau, Atlantic City, Las Vegas and Biloxi, Mississippi.

“When we look at the reasons, it is clear that other jurisdictions have responded to the times, consumer demands, and have improved their consumer offerings and regulatory framework”

The Bahamian casino industry collectively generates around $146 million in annual revenues currently, with the Government’s gaming tax take standing at close to $12 million.

The BHTA, though, said yesterday that the Government could see an annual gaming tax revenue of anywhere between $17 million to $30 million, depending on what proposals were adopted.

Apart from generating new tax revenues for the Government, the BHTA said the main purpose of the casino gaming reforms was to increase private sector revenues and job opportunities, plus create a competitive advantage for the Bahamas that attracted more tourists to the destination.

“Tax revenue and employment levels have remained flat, while other jurisdictions have seen significant growth,” Mr Bowe said.

“The 1969 Act needed updating due to innovations in internet technology, mobile gaming, a proliferation of new games based on consumer demand, and modern best practices which have been incorporated into casino operations globally.”