Gambling zone in Crimea: location and what will it have to offer

Gambling zone in Crimea: location and what will it have to offer
26.03.2019

The gambling zone in Crimea goes back to 2014, when the State Duma of the Russian Federation adopted the bill in the first reading, and later Vladimir Putin signed it.

According to the bill, the region’s authorities have to define the boundaries and location of this zone. The Ministry of Regional Development of Russia offered the authorities to open facilities at five-star hotels in different places, but the idea was not supported. Since that time, Crimean towns have been competing to house the gambling zone.

Location of the zone

The zone was said to be created in Yalta. Later Koktebel and Rozdolnensky District were considered as options. Then there was an offer to arrange the zone near Simferopol in order to boost the development of the region. Further, the head of Yalta once again proposed to set the zone in his town with the aim to solve social problems. All of it took place in 2014–2015.

Finally, the issue seemed to be resolved in 2016: the authorities of Crimea opted for Gaspra located near the famous Swallow's Nest castle. However, the idea was abandoned in favor of the current version: Katsiveli.

Katsiveli is an urban-type settlement located on the southern coast of the Crimean peninsula. Legally, it is part of the Yalta Municipality. In 2018, head of Crimea Sergey Aksenov reported that construction of the zone had already started and the first facility would be put into service in late 2019.

“In fact, the work is in progress. We already have the development project. Preliminary, the casino will be put into service at the end of 2019,” Aksenov stated.

The construction site in Katsiveli was moved from municipal property to government property in late 2018.

Who will manage and develop

Back in 2014, the Cabinet of Ministers of the Republic of Crimea reported that the regional ministry of finance would take charge of the gambling zone.

At the same time, the parliament of Crimea defined the maximum possible tax amount for gambling houses. For example, a tote processing center or a betting house will have to pay 125,000 rubles per month. And every betting shop will have to pay 7,000 rubles per month.

However, the Crimean authorities believe that such figures will not scare away investors. They expect the opposite effect – comprehensive regulation of the field will attract serious market players.

Names of investors and companies are not disclosed because the global community imposed sanctions against Crimea. However, it is known that they will be major hoteliers and casino operators from China, Russia, and Korea.

Mass media reported that some Russian company planned to invest 8 billion rubles in the zone in 2017. At the same time, the resident of the Azov City gambling zone Shambala announced its plans to build a casino in Crimea.

Revenues from the gambling zone

In 2018, the Crimean authorities received 10 million rubles in taxes from betting houses and totes, even though the gambling zone has not been constructed yet and makes no assignments to the budget.

Meanwhile, financial experts forecast that the Crimean budget will gain 44 million of gambling tax revenue in the period from 2019 to 2021.

However, the treasury of the Republic is expected to be filled not only with tax revenue. The Head of Committee for sanatorium-resort complex and tourism of the Crimea Aleksey Chernyak stated that gambling facilities would facilitate the tourist flow. In its turn, this will positively influence the business in the region.

What’s the result?

There is the following situation in the Crimean gambling industry: taxes are already filling the budget meaning that the betting sector is growing. The first casinos are being constructed in Katsiveli meaning that investors have shown their interest. Names of facilities and their number are not disclosed for now, but it is known that operators are from China, Russia, and Korea. The first facility is planned to be put into service in late 2019. The gambling zone in Crimea has all chances to become successful and start bringing profits in the first year of existence.

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