Korea Casino Association Flags Risks from Tourism Levy Adjustment Proposal

The Korea Casino Association, which represents South Korea’s foreigner-only casino operators, issued a warning in July 2026 about a proposed increase in the tourism levy from 10% to 15% of revenue; this change, according to the association, could accelerate bankruptcies for facilities still recovering from COVID-19 effects while the Ministry of Culture, Sports and Tourism advances its plan that also calls for five-year license renewals plus stricter ownership rules.

Core Elements of the Ministry Proposal

Under the Ministry framework the tourism levy would rise from its current 10% level to 15% of revenue, a shift that the association states would place additional pressure on operators already navigating post-pandemic recovery; the same proposal introduces five-year license renewal cycles instead of shorter terms and adds tighter requirements around ownership structures that casino groups must meet to maintain operations.

Data collected by the association shows the industry faces unique taxation because levies apply directly to revenue even during periods of loss, a structure that has resulted in roughly half of all operators reporting annual deficits across the past decade; despite these ongoing challenges, the tourism fund recorded its highest collection yet at KRW219.5 billion for 2025, a figure that reflects strong contributions from the sector under existing rates.

Taxation Structure and Historical Performance

Operators pay the tourism levy on gross revenue regardless of profitability, a mechanism that differs from standard corporate taxation models applied elsewhere in the economy; this approach has produced consistent shortfalls for many facilities, with the association documenting that approximately 50% of members posted deficits each year over the ten-year span ending in 2025.

Record collections reached KRW219.5 billion in 2025, demonstrating that current rates already generate substantial revenue for the tourism fund, yet the association notes that further increases could push marginal operators beyond sustainable thresholds during their recovery phase from COVID-19 disruptions.

Recovery Challenges Following COVID-19

Casinos under the association’s umbrella continue to rebuild visitor numbers and operational capacity after the pandemic period, a process that has required sustained investment in facilities and marketing; the proposed levy hike from 10% to 15% arrives while these recovery efforts remain incomplete, creating the risk that some operators may face insolvency before full stabilization occurs.

License renewals set at five-year intervals would provide longer planning horizons for compliant operators, while stricter ownership rules aim to ensure greater transparency and stability in the sector; the association emphasizes that these combined changes, particularly the revenue-based levy increase, could compound existing financial strains without corresponding adjustments for loss-making periods.

Association Position on Industry Sustainability

The Korea Casino Association highlights that taxation on revenue rather than profit leaves operators exposed during downturns, a factor that has contributed to repeated deficit years for many members; with half the industry reporting annual shortfalls over the past decade, the group argues that an additional 5% levy would reduce available capital needed for post-COVID rebuilding and ongoing compliance with new ownership standards.

Collections of KRW219.5 billion in 2025 mark the highest total to date for the tourism fund, indicating that the current 10% rate already delivers significant contributions; the association’s statement from July 2026 frames the proposed adjustment as a potential trigger for accelerated bankruptcies rather than a measured increase that accounts for the sector’s recovery timeline.

Conclusion

The Korea Casino Association’s July 2026 warning centers on the combined impact of the proposed 15% tourism levy, five-year license cycles, and enhanced ownership requirements, all of which the group links to heightened bankruptcy risks for foreigner-only casinos still emerging from COVID-19 effects; historical data on revenue-based taxation and deficit rates provide the factual basis for these concerns, while 2025 collection figures illustrate the existing scale of contributions under current rules.