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

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 maximum tourism levy from 10 percent to 15 percent of revenue along with regulatory shifts that include five-year license renewals, and observers note these changes could accelerate bankruptcies among operators still recovering from the effects of COVID-19.

According to the association teh casinos face a distinctive tax structure because they are levied on revenue even during periods of operating losses, and data shows roughly half of the operators have recorded annual deficits across the past decade despite their contributions to tourism revenue streams.

Details of the Proposed Changes and Industry Response

The proposed adjustments target the tourism levy that applies specifically to foreigner-only facilities, and the association points out that raising the rate from its current maximum of 10 percent to 15 percent would coincide with requirements for shorter license renewal cycles that add administrative and financial pressures at a time when many properties continue to rebuild visitor numbers after pandemic-related closures.

Industry figures reveal that operators contributed a record KRW219.5 billion in 2025, marking a 61.7 percent rise compared with 2019 levels, yet the group emphasizes that such payments occurred alongside ongoing losses for a significant portion of members because the levy calculation does not account for profitability.

Financial Pressures During Post-Pandemic Recovery

Experts tracking the sector note that foreigner-only casinos in South Korea operate under rules that differ from domestic facilities, and the revenue-based levy creates unique challenges when visitor volumes remain below pre-2020 figures while fixed costs for licensing and operations persist at full strength.

Those who have studied the decade-long data find that nearly 50 percent of the represented operators posted annual shortfalls, and the association argues that an increased levy combined with five-year renewal mandates would compound cash-flow strains without corresponding improvements in market access or visitor inflows.

Regulatory sources indicate the tourism levy supports national tourism initiatives, while the association highlights that its members already deliver substantial economic input through employment and related spending even in deficit years.

Context of Contributions and Operational Realities

Records from 2025 show the KRW219.5 billion total exceeded prior benchmarks, and analysts attribute part of the growth to renewed international travel patterns that benefited select properties while others lagged in recovery trajectories.

The association maintains that because the levy applies to gross revenue regardless of net results, operators cannot offset losses against tax obligations in the same manner available to other tourism sectors, and this structure has led to repeated deficit years for half the group over ten years.

License renewal changes proposed alongside the levy adjustment would require operators to demonstrate compliance and financial stability at more frequent intervals, which the association states could limit flexibility during ongoing stabilization efforts following COVID-19 disruptions.

Broader Implications for the Sector

Industry reports compiled in mid-2026 illustrate that foreigner-only casinos continue to adjust marketing and operational strategies to attract overseas visitors, yet the combination of higher levy rates and renewal cycles introduces variables that could affect long-term viability for smaller or slower-recovering properties.

Data from the past decade underscores the pattern of annual deficits affecting approximately half the operators, and the association connects this history directly to the risk that further revenue-based charges could push marginal facilities toward insolvency without adjustments to the levy mechanism itself.

Conclusion

The Korea Casino Association’s July 2026 statement centers on the projected effects of the tourism levy increase to 15 percent and the introduction of five-year license renewals, framing these measures against the backdrop of post-COVID recovery and a decade in which half the operators experienced deficits while still delivering record contributions of KRW219.5 billion in 2025. The group’s position rests on the revenue-based nature of the levy, which continues irrespective of profitability, and on the cumulative pressures these regulatory proposals would place on operators seeking to stabilize operations.