Korea Casino Association Raises Alarm Over Proposed Tourism Levy Increase for Foreigner-Only Operators

The Korea Casino Association, which represents South Korea's foreigner-only casino operators, has issued a direct warning that a proposed increase in the maximum tourism levy from 10 percent to 15 percent of revenue combined with five-year license renewals would accelerate bankruptcies among operators still recovering from the COVID-19 pandemic.

Association representatives emphasized that casinos operate under a distinctive tax structure where levies apply directly to revenue even during periods of financial loss, a system that differs from standard corporate taxation models used across other industries and creates ongoing cash flow strains when visitor numbers remain below pre-pandemic levels.

Details of the Proposed Changes

The suggested adjustments would raise the upper limit on the tourism promotion levy while introducing shorter license renewal cycles that operators argue add administrative burdens and uncertainty at a time when many facilities continue to rebuild visitor traffic and operational stability after extended closures and travel restrictions during the pandemic years.

Financial Contributions Highlighted in the Statement

According to the association's statement released in July 2026, the Tourism Promotion and Development Fund collected a record KRW219.5 billion from casino operators in 2025, representing a 61.7 percent increase compared to 2019 figures, which demonstrates the sector's substantial ongoing contributions despite ongoing recovery challenges and regional competition pressures from neighboring markets.

Those figures reveal that the sector has continued to generate significant revenue for government tourism initiatives even as individual operators navigate reduced patronage and elevated operational costs associated with post-pandemic market conditions.

Competitiveness Concerns Amid Regional Rivals

The association urged the government to reconsider the proposed levy hike and renewal framework, noting that such measures could undermine the ability of South Korean foreigner-only casinos to compete effectively with facilities in nearby jurisdictions that maintain different regulatory and taxation environments, potentially driving business toward those alternative destinations.

Operators pointed out that the combination of revenue-based levies applied regardless of profitability and shorter license periods creates a regulatory environment that may not align with the capital-intensive nature of casino operations, where long-term investment recovery often requires stable policy conditions over extended periods.

Association's Position on Policy Adjustments

Representatives from the Korea Casino Association called for the government to maintain the current 10 percent levy ceiling and review the proposed five-year renewal cycle, arguing that preserving existing frameworks would better support the sector's contribution to tourism promotion funds while allowing operators time to stabilize their financial positions fully.

Industry participants noted that the record KRW219.5 billion collected in 2025 already reflects strong sector performance relative to pre-pandemic benchmarks, suggesting that further increases in the levy rate might not yield proportional benefits if they lead to reduced operational capacity or facility closures among smaller or mid-tier operators.

Conclusion

The Korea Casino Association's July 2026 statement outlines specific risks associated with the proposed tourism levy increase and license renewal changes, emphasizing the sector's distinct tax treatment, its record contributions to the Tourism Promotion and Development Fund, and the need to sustain competitiveness against regional alternatives while operators complete their post-pandemic recovery.