Russia has four specific areas named by the government where gambling is legal. One of these territories, a region close to the borders of China and Korea is planning to develop a casino gambling and entertainment area near the city of Vladivostok. The Russians hope to develop up to 12 casinos in the first phase of the casino resorts to be built within four years. The gambling area of 6 square kilometres, which could be enlarged depending on investment in the complex, could hold up to five large casino resorts. Potential investors have until almost the end of September to submit their application.
The Russian government hopes to cash in on the very large and still expanding Asian gambling market. It hopes to attract players and tourists from Japan, South Korea and China in particular. The Russian gambling zone could attract players from northern China as the journey would be shorter than that to the major gambling centres in Asia such as Singapore and Macau. A major emphasis is being placed on the attraction of the casino resorts as places of entertainment like Las Vegas so the government is looking for investors who will develop the entertainment and convention side of the casino complexes with shopping centres, hotels, leisure activities, restaurants and convention centres. It is estimated that income from gambling and entertainment could be from 2 to 7 billion dollars when the whole area is complete.The new Russian casino area wishes to attract well known large scale casino operators internationally. In order to attract these well established casino developers the Vladivostok legal gambling zone is offering very enticing terms for leasing the land, no restrictions on the size of the casino gaming area and extremely low tax rates.
These tax rates which are close to zero on gross casino income compare extremely well with Singapore’s tax on gross casino revenue of about 15% and the rate of 39% imposed on gambling revenue in Macau. The Russian casino complexes will also face competition from other Asian countries which have recently started developing gambling and tourism resorts to attract investment such as the Philippines and Vietnam. While the tax rates and other conditions are favourable to attract inward investment into the casino resorts, the Russians are basing their protection against money laundering and fraud on the international norms in place in Las Vegas, Singapore and Macau.Unlike in Vietnam, where local people cannot gamble in the newly developed casino resorts, Russian citizens will be able to play in the casino resorts to be developed within the government designated legal gambling area.