Almost half of CNMI e-gaming machines to switch off as new tax forces venue closure

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Almost half of the e-gaming machines operating in the Commonwealth of the Northern Mariana Islands will be turned off after the operator of two e-gaming venues announced it was shutting one down in response to a sudden increase in taxes.

Club 88 in Saipan, home to 73 of the CNMIs 199 e-gaming licenses, will close its doors on 27 August after the government earlier this month enacted a law that effectively doubles the license fee of electronic gaming operators.

According to local media reports, the closure will also result in 30 staff losing their jobs and comes after its operator, MP Holdings LLC, also shut down Saipan Country Club last Friday to cut costs. MP Holdings also operates another e-gaming venue, Saipan Vegas, as well as the Saipan Country Club.

Gus Noble, a spokesman for the company, told reporters on Tuesday that he has tried to meet with local officials to negotiate a better option but has received no response.

As reported by Inside Asian Gaming, the new law imposes an additional fee comprising the greater of US$2,500 per machine or 15% of net gaming revenue per machine on top of current taxes. Taxes already in place include a US$100,000 license fee per venue plus 5% Business Gross Revenue and Tax.

Noble said the governments efforts to raise additional revenue via the CNMIs 199 e-gaming terminals was backfiring as were just about to take 73 out of it.

Its a big percentage and its lost revenue for the government, he said.

It is believed the law is an attempt by the government to raise funding in the absence of revenue from Imperial Pacific International the Saipan IR operator whose casino license is currently suspended for failure to meet its many financial commitments.