South Korea Foreigner-Only Casinos Confront Levy Hike and Renewal Rules

The Korea Casino Association, which represents South Korea’s foreigner-only casino operators, issued a direct warning in July 2026 about a proposed rise in the mandatory tourism levy from 10 percent to 15 percent of revenue; the group stated that such an increase would accelerate bankruptcies among operators still recovering from the effects of COVID-19.

Association representatives pointed out that casinos face taxation based on revenue regardless of whether they operate at a profit or loss, a structure that differs from other industries taxed solely on profits, and they also criticized plans to shorten license renewal periods to five years as a move that would reduce competitiveness against regional rivals in Asia.

Details of the Proposed Levy Adjustment

Under the current framework the tourism levy stands at 10 percent of gross revenue for foreigner-only casinos, yet the suggested change would lift that rate to 15 percent and apply the charge even in periods when operators record net losses; the association explained that this revenue-based approach creates ongoing financial pressure because the levy must be paid irrespective of overall performance.

Operators have noted that many facilities continue to rebuild visitor numbers and stabilize cash flow after pandemic-related closures and travel restrictions, so an added three-percentage-point burden on every unit of revenue would compound existing recovery challenges without regard to profitability.

Unique Tax Treatment Compared With Other Sectors

Unlike hotels, restaurants, or retail businesses that pay corporate taxes only when they generate profits, South Korea’s foreigner-only casinos pay the tourism levy on total revenue; this distinction means loss-making properties still remit the full percentage, which the association described as a structural disadvantage that other tourism-related industries do not share.

The group highlighted that this revenue-based collection continues even during months when visitor counts remain below pre-pandemic levels, thereby limiting the ability of operators to retain capital for maintenance, staff retention, and marketing efforts aimed at international tourists.

License Renewal Concerns and Regional Competition

Additional proposals include shortening the license renewal cycle to five years, a change the association argued would introduce greater regulatory uncertainty and deter long-term investment; operators currently operate under longer renewal intervals that allow more stable planning for capital expenditures and market positioning.

Regional competitors in Macau, Singapore, and the Philippines maintain licensing frameworks and tax structures that the association views as more predictable, and any increase in South Korea’s effective tax burden combined with shorter renewal periods could shift high-value foreign visitors toward those destinations instead.

Recovery Context After COVID-19

Many foreigner-only casinos in South Korea experienced sharp revenue declines during the pandemic because of border closures and reduced international travel, and although visitor numbers have risen since restrictions lifted, several properties have not yet returned to pre-2020 performance levels; the association stated that the proposed levy increase would arrive at a time when balance sheets remain fragile.

Revenue data collected since 2023 shows gradual improvement yet also indicates that fixed costs and ongoing recovery investments continue to absorb a large share of income, leaving limited margin for an additional levy that scales directly with every won earned.

Association Position and Requested Review

The Korea Casino Association called for policymakers to reconsider the levy adjustment and the shorter renewal cycle, noting that both measures would apply exclusively to the foreigner-only segment and could reduce overall tourism revenue if operators scale back operations or exit the market; the statement referenced in the July 2026 report emphasized that maintaining current levy rates and longer license terms would support continued contribution to the national tourism economy.

Association members pointed to the sector’s role in attracting foreign currency and supporting related industries such as hotels, transportation, and retail, arguing that any policy change should account for these downstream economic effects before implementation.

Conclusion

The Korea Casino Association’s July 2026 warning centers on two specific policy proposals: raising the tourism levy to 15 percent of revenue and shortening license renewals to five years; both changes, according to the group, would intensify financial strain on operators still recovering from COVID-19 while placing South Korea’s foreigner-only casinos at a disadvantage relative to regional competitors that tax profits rather than revenue and offer longer licensing stability.