Why will the newly proposed gambling tax ultimately have a negative fiscal impact? How will the taxation of winnings fundamentally affect the gaming industry? And why does it threaten to strengthen the illegal business?
“In our view, a tax increase is appropriate given the state’s need to consolidate its finances. However, we believe that the increase should take place after discussion or analysis. The state has done nothing of the sort and is coming up with a tax increase of 7 percentage points from 23 to 30 per cent. If I raise somebody’s taxes by one-third, I cannot expect it to be without impact. At the same time, we must remember that this is a tax on gambling, that is, on revenue. Meanwhile, operators also pay tax on profits,” points out Jan Rehola, Director of the Institute for Gambling Regulation. Jan Řehola discussed the impact of the government’s consolidation package in detail for Deník e15.
He also spoke about how big the illegal market currently is and why the state should primarily focus on combating it more effectively. “The most effective tool in the fight against illegal business is to have a sufficiently atractive and strictly regulated gambling supply. If the player has the opportunity to participate in the market in a legal environment and the game is not extremely disadvantageous compared to the illegal offer, the player will choose a legal operator where he has guarantees,” says Jan Řehola.
Listen to the podcast here.
