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Mozambique Casino Tax Revenues Increase as COVID Restrictions Relax

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Official data released this week by Lusa showed significant growth of tax revenues from casinos in Mozambique for the first quarter of 2023. The increase of more than 12% compared to the same period in the previous year reflects the easing of pandemic restrictions and the reopening of casinos.

Related: Ukraine Introduces New Turnover Tax on Online Casinos and Tighter Gaming Regulation

Growth Factors and Projections

The recently published data detailed the revenue performance from January to March of the state budget. It showed that the collection of the Special Tax on Gambling for the quarter amounted to 88.4 million meticais (€1.3 million). This figure accounts for 9.9% of the projected annual revenue from this tax.

The report attributed the nominal growth to “the conditional reopening of casinos and some easing of restriction measures, due to the slowdown” of the pandemic. The government’s estimates for the full year 2023 indicate that tax revenues from casinos are expected to reach 891.3 million meticais (€12.8 million). This would represent 0.1% of the total state revenue for Mozambique for the year.

Related: Macau Records Highest Monthly Gaming Revenue since COVID

Regulatory Framework and Taxation

The National Directorate of Gambling in Mozambique has specified the requirements for obtaining a casino concession in the country. An applicant must have a share capital of almost $2.7 million (€2.5 million) and commit to an investment of at least $5.5 million over a five-year period.

Once authorized, the concessionaires are obliged to pay the Mozambican state a Special Tax on Gambling. The tax rate varies based on the length of the concession: 20% for up to 14 years, 25% for up to 19 years, 30% for 20 to 24 years, and 35% for 25 to 30 years.

In addition to this, the National Directorate of Games of Fortune or Chance dictates that “Concessionaires must also pay Stamp Duty, corresponding to 50% of the price of entrance tickets to the casinos.” However, these entities are exempt from any other taxes on profits generated from casino operations, as well as import duties on equipment and materials exclusively used for casino operations.

Related: India Levies 28% Goods and Service Tax on Gambling

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