Casinos across Jeju often use brokers… or junkets... to attract customers. In 2014, they paid out more in commissions to these junkets than what they earned. This is leading to growing calls for an adjustment to the commission price and a rise in tax revenues. Joseph Kim has more.
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Casinos hire brokers to attract customers

Paradise, Seven Luck, and other foreigner-only casinos across the island commonly hire brokers… or junkets... to fill up their gaming rooms.

Junkets play a pivotal role in the casino industry, as the revenue made by these customers accounts for more than 50% of total revenue.

Junkets here normally get a 30% commission fee… but this percentage can get as high as over 90%.

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Junket commission sometimes exceeds 90% of revenue

If the casino makes 100 dollars from a certain player, 90 dollars goes to the junket that introduced him or her.

Considering over half of Korea’s casinos are located in Jeju, how much exactly are junkets getting paid from these local casinos?

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According to National Assembly lawmaker Lee Sang-il (이상일) of the Education, Culture, Sports & Tourism Committee… the total commission paid by Jeju’s eight casinos in 2014 amounted to 243 billion won… with Majestar Casino inside Shilla Hotel paying 83 billion… and L Vegas Casino at The Hotel paying over 42 billion won in commissions.

One casino was found to have paid three times more in commissions than its total revenue.
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Kim Yong-min

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300+ junkets working for Jeju’s 8 casinos

Currently more than 300 junkets work for Jeju’s casinos. The problem is that despite their huge earnings, taxes are not imposed on these promoters because they set up companies overseas and take advantage of the fact that foreign corporations are not required to pay corporate taxes in Korea.

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Jeju City official
According to a tax treaty between Korea and China, individuals are supposed to file their own income taxes, but do you think these agents will report the commission they get from casinos?”
[전화 인터뷰 제주도 관계자]
"중국과 한국간 조세협약에 의해서 각자 과세를 해야하는데 에이전트가 제주에서 카지노 (영업)활동해서 수수료를 받았다고 신고하겠습니까?"

To deal with this problem Jeju City placed a public job opening for casino supervisors in July and is continuing to strengthen supervision of the casino industry.

[reporter]
Joseph Kim

Officials are pushing to revise a law that excludes commissions from casino revenues, in order to increase returns on revenue.

There are also growing calls for officials to adjust commission fees and raise tax revenues to foster a healthier casino industry.

Joseph Kim KCTV