The operator of Resorts World Genting, Malaysia’s only legal casino resort, has applied for a judicial review against a Malaysian government decision that the firm says would delay some promised tax incentives for its multi-billion-dollar revamp plan for the complex.
A Thursday note from Maybank IB Research flagged that the change of mind by the Malaysian authorities on the tax issue had been a factor in the 11-percent sequential fall in Genting Malaysia’s core net profit in the third quarter, due to it having to pay additional income tax of MYR166.2 million (US$40.1 million).
“We understand that Genting Malaysia will continue to recognise income tax at the higher rate of approximately 25 percent in its income statements until the Kuala Lumpur High Court finds in its favour,” said Maybank analyst Samuel Yin Shao Yang
In November the government budget plan said the casino licence fee paid by Genting Malaysia for its Genting Highlands facility was being be increased from MYR120 million to MYR150 million per year, while the casino duty rate was to be raised to 35 percent from 25 percent of gross gaming revenue. The authorities also said gaming machine duties were being increased from 20 percent to 30 percent on gross collection.
