Korea Casino Association Highlights Risks of Increased Tourism Levy for Foreigner-Only Operators

The Korea Casino Association, which represents South Korea’s foreigner-only casino operators, has issued a warning that a proposed increase in the tourism levy from 10 percent to 15 percent of revenue would accelerate bankruptcies for facilities still recovering from the effects of COVID-19, and the Ministry of Culture, Sports and Tourism has put forward this change alongside plans for five-year license renewals plus stricter ownership rules.

According to the association the industry operates under a unique tax structure that levies charges on revenue even when operators record losses, and roughly half of the operators have posted annual deficits across the past decade while record collections reached KRW219.5 billion for the tourism fund in 2025.

Details of the Ministry Proposal

The Ministry of Culture, Sports and Tourism advanced the levy adjustment in July 2026 as part of broader regulatory updates that would extend license periods to five years while introducing tighter controls on ownership structures, and these measures aim to channel additional funds into tourism initiatives yet the association points out that the revenue-based taxation model already places significant pressure on operators who continue to face uneven recovery patterns after the pandemic period.

Operators must pay the levy regardless of profitability because the system calculates obligations on gross revenue rather than net income, which means facilities posting consistent deficits still contribute substantial sums to the tourism fund, and the association notes that this structure has persisted for years with approximately half the operators recording shortfalls in each of the last ten years.

Financial Pressures Facing the Sector

Foreigners-only casinos in South Korea have navigated a slow rebound since COVID-19 restrictions lifted, and the association emphasizes that an additional five-percentage-point increase in the levy would compound existing financial strain at a time when many facilities have yet to return to pre-pandemic revenue levels, while the record KRW219.5 billion collected in 2025 demonstrates the scale of contributions already flowing from the sector into public tourism accounts.

Those who have examined the financial records observe that the combination of revenue-based taxation and post-pandemic recovery challenges has left limited room for additional levies, and the proposed shift would raise the effective burden without corresponding adjustments to account for ongoing losses at many properties.

Association Position on License and Ownership Rules

The Korea Casino Association has also addressed the accompanying proposals for five-year license renewals and stricter ownership requirements, noting that these changes would introduce further administrative and compliance costs at a moment when operators are focused on stabilizing operations, and the group argues that the cumulative effect of higher levies plus new regulatory layers could push marginal facilities toward insolvency.

Industry observers note that the foreigner-only segment operates under distinct rules compared with other gaming venues in the country, and the association has highlighted how this segment alone bears the revenue-based levy structure that does not adjust for profitability, which sets it apart from standard corporate taxation models applied elsewhere in the economy.

Current Collections and Future Projections

Collections for the tourism fund reached a record KRW219.5 billion in 2025, and the association uses this figure to illustrate the substantial ongoing contributions from the sector while cautioning that further increases could reduce the number of viable operators capable of maintaining those payments over the longer term, and the Ministry has not yet finalized the timing for implementing the higher rate or the new licensing framework.

Experts tracking the sector point out that the proposal arrives during a period when several operators continue to report deficits, and the association has presented data showing persistent shortfalls at roughly half the facilities over the past decade as evidence that the current framework already tests sustainability for many participants.

Conclusion

The Korea Casino Association’s statement in July 2026 underscores the potential consequences of raising the tourism levy to 15 percent of revenue while layering additional licensing and ownership requirements onto an industry segment still managing uneven post-pandemic recovery, and the group’s data on revenue-based taxation alongside historical deficit rates provides context for the concerns raised about accelerated bankruptcies. The Ministry of Culture, Sports and Tourism continues to develop the proposal, and operators await further details on implementation timelines and any potential adjustments to the framework.