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Global Casino Expansion

Harrah’s Entertainment, who recently acquired Caesars Palace casino and resort, is trying to globally expand their enterprise. Their current plans are to build Las Vegas style casino resorts in Europe and Asia; Spain and Slovenia being their first targets. With the introduction of online casinos, many of the land-based casino resorts fear a decline in player attendance. This is one of the reasons behind global expansion; the theory is, if a casino is relatively close to a gambler, then he will choose to interact with a live game rather than a computer.

Europe does not have any Vegas style gambling areas; and many international groups are hoping to begin building similar resorts to attract tourists. Spain is presently in the process of constructing such a site in El Reino, which is located 118 miles from Madrid. This is where Harrah’s is planning to build the first international Caesars Palace casino. The project is estimated to cost $670 million and will include 850 luxury rooms, a 50,000 square foot casino and a Colosseum theater which can seat 3,000 guests.

The only potential problem with the world wide expansion lies in the gambling taxes that Harrah’s will need to pay on profits. For example, Spain takes anywhere between 20-55% in taxes and Slovenia, 50%, this is an astounding increase from Nevada state taxes, which take only 6.75%. Harrah’s, and other groups, hope that foreign countries will implement tax cuts for the casino industry. The casino has big money written all over it, and is always a major tourist attraction. And considering the reputation of a Caesars Palace casino, it is sure to be a success regardless of location.

OCA News Editor

Jenny McKinnley is OCA’s financial correspondent. After spending years on the trading floor in both NY and London, she offers insight from the inside out on world financial news and events.

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