South African Casinos in Trouble After Budget Speech?
The annual budget speech may be a black cloud for the South African casino industry this year, as casino owners and players wait with heavy hearts to hear what casino regulations may be enforced, from a budgetary point of view. The speech, set for 24 February, is not predicted to have any good news for consumers or for casino owner, since the economic challenges currently facing the country are calling for everyone to tighten their belts and spend less on non-essentials. Many are expecting to hear that gambling taxes will spike, that more casino licenses will be issued to land-based casinos and that the online gambling industry, which is currently in a rather grey area in as far as South African gambling law is concerned, may suffer too.
An additional tax on gambling has already been in the pipeline for Gauteng for some time now and with the economy in dire straits, many are wondering whether the luxury of a South African casino may soon be one that no one can afford. But in recent figures released by CASA (the Casino Association of South Africa), it seems that in the last financial year, licensed casinos contributed about R5.7-billion to the economy and created about 65 000 jobs, while also spending over R100-million on projects for social upliftment. With figures such as this, many are wondering whether additional taxes will help the economy, or hurt it in the long run when casinos can no longer afford to keep their doors open and players have no disposable income to use on the games they so love.
Sun International’s CEO has spoken up about finances in as far as South African casinos are concerned, stating that the group was wise in bringing many of its dollar loans back into the country before the rand crashed last year, which saved the group a lot of money. But as he points out, the South African economy is based not just on what happens within the country itself, but on changes in the world.
After the mass hiring and firing of ministers towards the end of 2015, the appointment of Pravin Gordhan seemed like a smart move but there is no way of knowing whether he will be the saviour of what seems to be a quickly sinking economic ship. Many online economists in their various blogs and sites have commented that only a change at the very top will positively impact the country, and without some form of structure within the government, South Africans can expect only more pain and worry for a few years to come.
Of course, more optimistic thinkers have faith in the minister, who has shown many times that he has more than enough skill and experience in his field. However, what is still unclear is whether the minister’s announcements at the budgetary speech will allow for the South African casino industry to carry on as normal, or whether it will be facing some serious cutbacks, which will have knock-on effects on both employment and those who play at these casinos.