Better Hide the One-Armed Bandit
// The Mayor's Office offers its own plan to fight gambling
Initiative
Deputy Mayor of Moscow Iosif Ordzhonikidze made public a plan yesterday to “bring order” to the gaming business in Moscow, which he characterized as “chaotic.” There are 56 casinos, 5000 gaming halls containing 56,000 gaming machines, and 9000 gaming machines in other locations in Moscow. Their annual turnover is over $1 billion, on which $100 million is paid in taxes. The city plans to take inventory of all gambling machines in the city by the end of the month and remove them from streets, train stations and airports. The deputy mayor said that agreement has already been reached with Russian Railways and the airports on the matter. In addition, gaming halls will be prohibited in “pavilions,” the light, freestanding structures on streets, where more than half of them are located. Irregularities in licensing will be identified and harshly dealt with.
Gaming business representatives say that the mayor's measures are a violation of freedom of enterprise. “The gaming business does not need special permission to rent real estate,” objected Stanislav Bartnikas, marketing director for Ritzio Entertainment Group, which manages the Vulkan chain of gaming halls. “Such limitations can only be introduced on the federal level.”
The measures are aimed at small chains of gaming halls and at illegal gaming halls. Large-scale operators will benefit from the move. They face the prospect of a doubling of taxes on gaming machines (to 15,000 rubles per month) ad a hike in the licensing fee from 3000 rubles to 30,000. Some Duma members and United Russia officials are talking about banning gambling in Moscow, St. Petersburg and Sochi next years as well. The administration of Moscow had not expressed a position on those initiatives previously, but Ordzhonikidze said yesterday that the city would oppose Duma plans to prohibit gambling in Moscow and other cities, but would support the tax increase. “It's a law that's unrealizable,” he said of the proposal to ban gambling in its major centers in Russia. “Gaming centers cost $50-60 million. Who is going to compensate the owners for the lost investment? Moscow won't.”
Alexander Voronov, Vadim Visloguzov
All the Article in Russian as of Jan. 20, 2006
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