South Korean Hospitality Coalition Challenges Proposed Casino Levy Hike and License Changes

A coalition of 12 South Korean tourism and hospitality organizations released a joint statement on August 3 2026 that calls on the Ministry of Culture Sports and Tourism to withdraw a proposed reform plan for foreigner-only casino operators and the groups include the Korea Casino Association the Korea Tourism Association the Korea Hotel Association and the Korea Association of Travel Agents along with eight additional bodies that represent integrated resort developers travel agencies and hotel operators across the country.

The statement highlights three main elements of the reform package that would raise the existing levy on gaming revenue from 10 percent to 15 percent introduce mandatory five-year license renewal cycles and apply these rules to operators still recovering from pandemic-era revenue losses and the organizations warn that the combined effect could reduce operator profits by 20 to 37 percent while limiting capital available for new integrated resort projects.

Details of the Proposed Reforms

Under the current framework foreigner-only casinos pay a 10 percent levy on gross gaming revenue in addition to corporate taxes and the ministry proposal would increase that levy to 15 percent beginning in the next fiscal cycle while adding a requirement that operators submit detailed renewal applications every five years rather than operating under longer-term or indefinite approvals and industry analysts note that similar renewal processes in other jurisdictions have sometimes led to extended review periods that delay investment decisions.

The coalition document points out that several domestic operators continue to carry pandemic-related debt loads and reduced cash reserves and the groups argue that the higher levy would leave less margin for debt service and facility upgrades while the shorter license horizon could discourage foreign partners from committing long-term capital to resort expansions planned for the Seoul and Busan markets.

Potential Impacts on Tourism and Competitiveness

According to the joint statement the proposed changes would place South Korean casinos at a disadvantage relative to established markets such as Macau and emerging competitors in Japan where tax structures and licensing terms remain more favorable to operators and the organizations cite data showing that integrated resorts in those locations have attracted higher average capital expenditure per property over the past five years.

Representatives from the Korea Association of Travel Agents added that reduced operator profitability could translate into fewer marketing partnerships with overseas travel agencies and lower commission structures for tour operators that currently promote packaged casino visits to high-spending foreign guests and the statement notes that inbound tourism figures for 2025 already reflected a partial recovery that still fell short of pre-pandemic levels in several key source markets.

Industry Recovery Context After COVID-19

Multiple operators cited in the coalition statement reported that visitor volumes have returned to roughly 70 percent of 2019 levels yet average spend per visitor remains lower because of lingering travel restrictions in some source countries and the groups contend that an additional five-percentage-point levy would push several properties closer to break-even points where continued operation becomes marginal.

The document also references internal forecasts prepared by member associations that project potential bankruptcy filings among smaller operators within 18 to 24 months if the full reform package takes effect and the coalition requests a formal impact assessment that would include stress testing under various revenue scenarios before any new levy or licensing rules are finalized.

Next Steps and Ministry Response

The Ministry of Culture Sports and Tourism has not issued an official reply to the August 3 statement as of the latest available reports and the coalition has scheduled follow-up meetings with ministry officials and members of the National Assembly tourism committee to present detailed financial models and the organizations have indicated they will also submit the statement to the prime minister's office for review.

Observers note that previous policy adjustments in the Korean casino sector have typically involved extended consultation periods with industry associations before final regulations were promulgated and the current coalition effort follows that established pattern of collective advocacy on tax and licensing matters.

Conclusion

The joint statement issued on August 3 2026 by the 12 South Korean tourism and hospitality organizations outlines specific concerns over the proposed increase in the foreigner-only casino levy the introduction of five-year license renewals and the resulting effects on profitability and future investment and the groups have asked the Ministry of Culture Sports and Tourism to conduct further analysis before proceeding with the reform package.