Panama Scraps Tax on Casino and Betting Winnings to Attract Tourists
Panamanian authorities have announced the scrapping of a 5.5% tax on winnings from table games and betting. The measure aims to attract foreign players and boost tourist arrivals that have declined in recent years for this niche.
The Gambling Control Committee, known as the Junta de Control de Juegos or JCJ, under the Ministry of Economy and Finance, made the announcement. Officials described the step as a way to make Panama more competitive with Caribbean and U.S. destinations that do not impose a similar direct tax on players.
The 5.5% tax was introduced in 2015 by the previous administration. It applied to cash redemptions and winnings at casinos, bingo halls, slot machines and sportsbooks. The levy was created to help finance higher pension payments.
JCJ Secretary Manuel Sánchez said the tax had become a barrier for international gamblers. “The elimination of the tax will support the hotel and tourism sector because players will get better value when traveling to Panama,” he stated in the official release. Gaming revenue had fallen sharply. In the first eight months of the announcement year, collections from gambling totaled $50.8 million, a drop of 33.2 percent from the same period the year before.
Tourism generates up to 10 percent of Panama’s gross domestic product. Hotel occupancy rates had fallen below 45 percent in some time periods and has cost thousands of jobs. Officials said the tax made Panama less attractive to high-rollers who spend on hotels, restaurants and other services beyond the casino floor.
Online gambling continues to grow globally at 10 to 12 percent a year and operates under different tax rules, often a 10 percent gross gaming revenue levy for licensed operators. Physical casinos face higher fixed costs for real estate, staff and utilities.
Alongside the tax removal, the JCJ outlined new oversight steps. It plans to start an integrated electronic monitoring system for operators. The committee also intends to add more auditors to address staff shortages that had affected collection rates. Officials stressed the importance of responsible gambling practices.
Casino industry representatives welcomed the change but noted it covered only table games in full-service casinos. Some called for broader relief across all gambling formats to speed recovery.
The move comes as Panama seeks to regain its position as a regional gaming hub. For years the country drew players from across Latin America who combined casino visits with trips to the Panama Canal and other attractions. The tax had shifted some of that business elsewhere.
No immediate timeline for the tax removal was released beyond the announcement. Implementation would require coordination with the Ministry of Economy and Finance. The JCJ said it would continue working to balance state revenue needs with industry growth. The tax change represents a shift from direct player withholding to other forms of oversight and collection.
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المصدر: Tico Times