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Full smoking ban could lead to 25 pct casino revenue loss: Macau MGM chief

A 15 to 25 percent loss in gaming revenue was possible if a blanket smoking ban would be imposed on casinos, as had been the case in other gaming jurisdictions, MGM Chief Executive Officer and Executive Director Grant Bowie said Thursday. Bowie made the gloomy prediction after attending a graduation ceremony of the gaming operator’s […]

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UPDATED: 22 Dec 2023, 5:54 am

A 15 to 25 percent loss in gaming revenue was possible if a blanket smoking ban would be imposed on casinos, as had been the case in other gaming jurisdictions, MGM Chief Executive Officer and Executive Director Grant Bowie said Thursday.

Bowie made the gloomy prediction after attending a graduation ceremony of the gaming operator’s staff who completed two training programmes which included a stint at the company’s property in Las Vegas.

Bowie insisted that smoking lounges were a “very good compromise” vis-à-vis the government’s proposal to impose a full smoking ban on all gaming premises, comprising mass gaming floors and VIP rooms. The government’s anti-smoking bill, which is being reviewed by a standing committee of the legislature, means that smoking lounges would not be allowed either.

Currently, smoking lounges are installed at casinos’ mass-gaming floors while smoking is still allowed in “no more than half” of casinos’ VIP rooms.

Legislator Andrew Chan Chak Mo, who heads the standing committee, said on Wednesday that it might take the committee one year to complete its revision of the bill. He also said that a two-month online consultation on the bill was slated to begin on August 1.

Bowie said that a smoking ban in casinos had to be carried out “carefully”, balancing the needs of the public and also “accommodating all our customers, including those customers who smoke.”

“The key issue is that this is a community industry, we’re not just operators on our own, we employ lots of Macau people,” Bowie said. “We’re trying to find the right balance, [that is] balancing up the health issues and also the economic issues, ensuring we can continue to make a contribution by way of taxes.”

Macau’s casinos pay 35 percent of their gross receipts as tax to the government, apart from additional dues amounting to about four percent of their gross receipts.

Bowie also said that he could not put a number on an estimated loss in gaming revenue but figures from other gaming jurisdictions could be an indicator.

“We know from international examples that have seen this change in the past, and it’s somewhere between 15 and 25 percent that’s occurred in other jurisdictions. We would not think we are different than other jurisdictions, so that is a possibility. I’m not saying that’s an absolute number but it is clearly an indicator,” Bowie said.

Bowie added that the company was still in talks with the government about the anti-smoking regulations and was “very confident” of proving that the smoking lounges “are safe, and we will develop them in a way that ensures they are externally vented.”

“We’re hopeful that the government will be able to adapt and accommodate the opportunity that this [the installation of smoking lounges] provides balancing up the needs of all constituents,” Bowie said.

Meanwhile, Melco Crown Entertainment Co-Chairman & CEO Lawrence Ho Yau-lung told reporters Thursday, after attending a graduation ceremony by his company to congratulate staff on completing their training courses, that he does not support the government’s bill which would result in a full smoking ban on all casino premises.

“Looking at this year’s economy and with the full smoking ban…” Ho said, “We very much support the health of our staff but up to now, I don’t see how smoking lounges can harm people’s health.”

Ho also said it was hard to say whether the city’s gaming revenue has hit the bottom yet, but it was at a level where the government was looking into austerity measures, “which would be less than ideal”.

“If the government is looking at austerity measures, a lot of other businesses, gaming operators, might have to look at them as well,” Ho added.(macaunews/macaupost)

UPDATED: 22 Dec 2023, 5:54 am

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