Inside Northern Marianas and Rota: How the Tax System Works for Remote iGaming Operators
Expert Insight provided by Andrea Ricci CPA, Tradepass International Tax

In today’s global iGaming market—where gross gaming revenue taxes are rising across key jurisdictions—choosing the right licensing hub has become a core driver of profitability. Recent developments in places like the United Kingdom and Brazil show how quickly a tax framework can reshape margins and operating models. Against this backdrop, the island of Rota, part of the Commonwealth of the Northern Mariana Islands (CNMI), is developing an interactive gaming regime aimed at serving foreign customers only (i.e., outside the United States). Because the CNMI is a U.S. territory, it offers a familiar legal and tax environment that can appeal to U.S.-aligned investors and other operators pursuing global expansion.

This article summarizes the key tax characteristics of holding a Rota online casino license through a CNMI-incorporated company.

1) The CNMI uses a “mirror” version of the U.S. Internal Revenue Code (NMTIT)

CNMI corporate income tax—often referred to as the Northern Mariana Territorial Income Tax (NMTIT)—largely mirrors the U.S. Internal Revenue Code (IRC), but with an important twist: “United States” is generally read as “CNMI.” This substitution matters for sourcing rules, customer-location concepts, and the availability of corporate deductions.

2) Licensing rules support a non-CNMI (foreign-market) revenue profile

A defining feature of the Rota remote gaming framework is geographic ring-fencing: operators must implement geolocation controls to block prohibited jurisdictions, including U.S. jurisdictions. This can help support the position that receipts are earned from customers located outside the CNMI, which may be relevant to tax treatment.

3) Section 250 IRC can be a central tax-planning element

Because the CNMI mirrors the U.S. Code, Section 250 IRC may be relevant in the NMTIT computation. In a mirror context, “foreign-derived” concepts are generally tested against the CNMI, meaning that services provided to customers outside the CNMI may qualify—subject to applicable limitations.

The practical challenge is documentation. Operators generally need to:

  • Segregate CNMI vs. non-CNMI receipts;
  • Substantiate customer location and use outside the CNMI (KYC + geolocation logs); and
  • Allocate expenses between qualifying and non-qualifying income.

Section 250 IRC provides a deduction for foreign-derived deduction eligible income (FDDEI)—i.e., income derived from foreign sources—calculated as a flat 33.34% of the relevant deduction eligible income (DEI). In effect, this can reduce the nominal corporate rate from 21% to roughly 14% on qualifying income.

4) Gross Gaming Revenue Tax, Gross Revenue Surtax, and Gross Revenue Tax

Operators should model not only NMTIT, but also the following gross-receipts layers:

  • Business Gross Revenue Tax (BGRT) – imposed at a nominal rate of 1% on gross revenue.
  • Business Gross Revenue Surtax – imposed at a nominal rate of 1% on gross revenue.
  • Gross Gaming Revenue Tax – imposed at a nominal rate of 10% on gross gaming revenue.

These layers can remain significant even if taxable income is reduced.

BGRT is a nonrefundable tax credit that may be used to offset corporate income tax liability. By contrast, the Business Gross Revenue Surtax and the Gross Gaming Revenue Tax are imposed at the municipal level (i.e., by Rota) and are generally treated as deductions in computing the NMTIT tax base.

5) Rebates may significantly reduce the NMTIT liability

The main “rebate system” is codified in 4 CMC § 1708 (Tax Relief). In broad terms, it provides a rebate offset computed from a defined “rebate base” (generally, the NMTIT attributable to CNMI-source income—determined under standard sourcing principles—net of certain nonrefundable credits, such as the BGRT credit) and then applies a tiered percentage formula for most taxpayers (e.g., 90% / 70% / 50% brackets). After applying the rebate mechanism, NMTIT liability is typically substantially reduced (often by at least 50%).

6) U.S. investor considerations may still apply

Even if the company pays tax under the CNMI mirror system, it may still be treated as non-domestic for U.S. federal purposes. As a result, U.S. owners may face additional U.S. international tax and reporting considerations, depending on the structure.

Bottom line

A Rota remote gaming license can combine a U.S.-style tax framework (mirror IRC) with an international commercial footprint (non-CNMI customers), potentially creating planning opportunities—especially where Section 250 IRC concepts and the NMTIT rebate mechanism apply. Because U.S.-style gambling enforcement concepts (e.g., Wire Act, UIGEA) and AML/KYC expectations also influence the CNMI environment, Rota is positioned to become an interesting hub for global iGaming licensing. 

Overall, the combined income and gross-revenue tax burden may be relatively affordable and stable over the long run, offering a potential competitive advantage for international iGaming operators expanding globally.