Attorneys representing members of The Bahamas Gaming Operators Association (BGOA) will appear before Justice Indra Charles this morning for a hearing, after filing a class action lawsuit against government late yesterday afternoon.
The move is based on the sliding scale tax of the industry that will go into effect on September 1st.
Lead attorney, Alfred Sears, QC, categorized the tax as unconstitutional, discriminatory, irrational and inequitable and predicted that the tax would lead to the demise of the seven regulated gaming operators in a 12 -month period.
The tax was revealed during the budget communication in June and since that time gaming operators have opposed the tax claiming that government made their decision based on information that was not relevant to the domestic industry. They also faulted the government for no consultation on the tax.
Government did delay the tax that was initially expected to take effect on July 30thand said that additional research would be done along with consultation, but never dismissed its implementation. Gaming operators have also threatened massive job cuts across the sector if the tax were to take effect.
Gaming houses that make up to $20 million will be taxed at a rate of 20 percent; operators that make between $20 million and $40 million will be taxed at a rate of 25 percent; those that make between $40 million and $60 million will be taxed at a rate 30 percent; those making between $60 million and $80 million at a rate of 35 percent; those making between $80 million and $100 million at a rate of 40 percent; and the gaming houses bringing in more than $100 million at 50 percent.
Gaming patrons will also be taxed a five percent stamp tax applied on deposits and any non-online games or digital sales.