The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Lingering discrimination “will have to be addressed” so that domestic Bahamian web shop operators are ultimately placed on “a level playing field” with their foreign-owned casino counterparts, a former attorney general is arguing.

Alfred Sears QC, the Gaming House Operators Association’s attorney, told Tribune Business that unequal taxation rates and the prohibition on tourist customers were two issues that had to be dealt with “going forward”.

Under the new Gaming Act, web shop operators must pay to the Government either 11 per cent of taxable (gross adjusted) revenue or 25 per cent of earnings before interest, taxes, depreciation and amortisation (EBITDA) are deducted, depending on which is greater.

Yet Mr Sears pointed out that the foreign-owned, hotel-based casinos were taxed at a much lower rate of 5 per cent of adjusted gross revenue.

“On the issue of discrimination, there’s still a number of outstanding issues,” he told Tribune Business. “One is the issue of taxation.

“I think it’s grossly unfair that gaming house operators pay 11 per cent or 25 per cent, whichever is greater, for interactive gaming when the casinos are taxed at 5 per cent on their interactive gaming. Certainly, the area of taxation, I think, is discriminatory.”

Mr Sears added that Bahamian taxpayer funds were also being used to subsidise foreign-owned gaming, yet both web shop operators and players were participating in something that was not recognised and akin to “a grey regime”.

“The Bahamas has been in a very strange position with regard to gaming,” he explained, “incentivising gaming through cash contributions, and providing exemptions for gaming through Customs duties and Business Licences, but refusing to recognise and regulate the Bahamian-owned domestic gaming industry.”

This, Mr Sears said, meant that Bahamian web shop operators had been in a situation where they could not access/benefit from government incentives for the sector.

And, due to the restrictions in the Gaming Act, domestic gaming houses are prevented from marketing their businesses to visitors and allowing them to participate as players.

“The Bahamian taxpayer spends millions of dollars to promote the Bahamas, attract visitors to our country, and the gaming house operators are denied the opportunity to provide their services to that market,” Mr Sears told Tribune Business.

“I think that’s really discriminatory. Having provided the promotional money to get the tourists here, and then be denied access to the six million-plus tourists visiting the Bahamas annually…..

“These areas of discrimination will have to be addressed going forward so that there is a level playing field in the gaming industry in the Bahamas, irrespective of whether it is a foreign-owned casino or Bahamian-owned gaming house operator.”