Leak out three billion-dollar casinos in Phu Quoc, Van Don and Bac Van Phong SEZs

The topic of casino business has warmed up after the official information in the draft plan of special administrative – economic zones (from now on referred to as special economic zones [SEZs]) was released, which allows Van Don, Bac Van Phong (Northern Van Phong) and Phu Quoc to initiate a large-scale casino project.

In Van Don, the high-end tourism complex, which can operate a casino, is invested by Sun Group with a total area of 2,500 hectares and the total investment of over US$2 billion, of which about US$312.5 million comes from the investors.

According to the granted investment certificate, the project duration is 50 years. However, Sun Group has proposed to increase it to 70 years.

Van Don Integrated Casino and Resort Complex consists of residential areas, convention centres, hotels, casino, golf courses, horse racing venues,... will be constructed on the Cai Bau and Tra Ngo islands.

More than US$2 billion as the investment capital will be raised from two primary sources. To be more specific, the contribution of Van Don Sun Joint Stock Company (under Sun Group) is about VND7,255 billion (roughly US$319.7 million), which accounts for 15% of the total investment.

The remaining 85% (about VND40,356.9 billion – US$1.78 billion) will be borrowed from Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) - Hanoi Branch following the planned progress from Q2 (quarter 2), 2017 to Q4, 2021.

It is expected that the first phase of the project will be implemented from Q3, 2017 to Q4, 2018. From Q1, 2019 to Q4, 2021, the second phase will be carried out while the first phase will come into operation. By Q1, 2022, the whole project will come into operation.

In the proposed plan for Phu Quoc SEZ, Kien Giang province said the casino would be built on an area of 30,000 square meters with 200 to 400 gambling tables and 2,000 gambling machines. Besides, it will also have international conference centres and five-star hotels with 3,000 rooms.

Regarding this project, in early 2015, the Ministry of Construction proposed to Prime Minister to relocate the site from Da Chong hamlet, Bai Thom commune, Phu Quoc to a new location adjacent to the resort Vinpearl Phu Quoc, owned by Vingroup.

After being relocated, the project was carried out with rapid progress. By this time, the project is nearly completed and ready to come into operation. In a meeting with Prime Minister recently, Kien Giang provincial People's Committee proposed a pilot that allows the Vietnamese to play at this casino.

In the proposed plan for Bac Van Phong special zone (Khanh Hoa), a casino with a scale of VND44,000 billion (roughly US$2 billion) is allowed to be built. However, not much information about this super project has been announced yet.

Casinos will enjoy special tax incentives

Along with permitting the Vietnamese to play in the casinos of special economic zones, the draft law on Special Administrative - Economic Units also introduces special tax incentives for casino projects.

To be more specific, casino business services, casino games (include jackpot games, slot machines and the like), betting services in special economic zones will be subject to a special consumption tax rate of 10% within ten years after the first time to earn revenue from the service, instead of the current 35% tax rate.