In an unexpected turn of events, Melco Resorts & Entertainment’s pioneering venture in Europe, City of Dreams Mediterranean, may be confronted with a new hurdle. The Cyprus Mail reports that casinos in northern Cyprus are set to benefit from a significant reduction in their income tax rates. This tax cut is part of a two-pronged reform recently approved by the north’s parliament, aimed at overhauling the taxation of casinos in the region.

Under the new reforms, the income tax rate for casinos will be slashed by half. Simultaneously, the rates paid for each gaming table and slot machine will see a 17% increase. The rationale behind this move is to discourage casinos from underreporting their income. Casinos are obligated to pay income tax at least equal to the amount they pay in gaming services tax.

Turkish Cypriot opposition party MP Erkut Sahali believes this strategy will encourage casinos to declare higher gross incomes to maintain the same tax payment. However, Sahali points out a potential flaw in this approach. Many casinos already pay taxes exceeding the minimum requirement. With the tax rate cut in half, the tax paid by these casinos will also be halved.

While numerous casinos operate in northern Cyprus, Melco’s City of Dreams Mediterranean stands as the sole casino in the south. Grant Johnson, Senior Vice President and Property General Manager of CoD Mediterranean, acknowledges the competitive pressure from northern casinos, which offer various rebates. Despite this, Johnson emphasizes the superior quality and service of City of Dreams Mediterranean, highlighting the need to attract players to experience their offerings firsthand.

As Melco seeks to establish its luxury casino against northern competitors, the company faces a challenging competitive landscape. Despite the allure of rebates offered by casinos in the north, City of Dreams Mediterranean aims to differentiate itself through its upscale amenities and superior customer experience.

The tax reform in northern Cyprus presents a new obstacle for Melco’s European venture. However, with a focus on quality and service, City of Dreams Mediterranean is well-positioned to navigate this challenge and establish itself as a premier destination for gaming enthusiasts. As the competitive landscape evolves, it will be crucial for Melco to adapt its strategies to maintain its competitive edge and attract discerning customers seeking a truly exceptional gaming experience.

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