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RGA Urges Changes To Poland's Betting Tax

by Ulrika Lomas, Tax-News.com, Brussels

29 September 2016


Poland will fail to develop its online gambling market if it persists with its turnover-based online sports betting tax, the Remote Gambling Association (RGA) has warned.

While Poland is in the process of reforming its existing gambling legislation, the RGA said that the decision to stick with the 12 percent tax on sports betting turnover will "continue to prevent licensed operators from providing the required level of value and choice to Polish consumers."

"As a result, Polish consumers will continue to seek out better offerings from operators who are licensed outside of Poland and who are not liable to pay tax there," the RGA said in a statement.

The RGA argues that a tax based on betting firms' gross profits rather than revenue would result in a more "viable tax regime."

"Unfortunately, we have already observed since 2011 the effect of a turnover tax on the ability of Poland's online gambling regime to attract European operators," observed Clive Hawkswood, Chief Executive of the RGA. "We have advised the Polish authorities that their fiscal framework is not workable. Until it is changed, few operators will take up licenses in Poland. This will continue to stifle competition, value, and choice for consumers."

The RGA said that a report it commissioned on the regulation of Poland's gambling market, undertaken by economic consultants Roland Berger, "clearly demonstrates" that a gross profit tax "would contribute to a better achievement of the Government's goals as compared to the current policies" by attracting more entrants into the market and boosting government revenues.

Following the adoption of the gambling reform bill by the Government on July 19, the proposals are now being scrutinized by Poland's Parliament. However, Hawkswood said that "failure to address this fundamental tax issue will unfortunately serve to make the bill ineffective because operators will not seek to enter or invest in a market where they cannot be profitable and competitive."

TAGS: tax | gambling | legislation | Poland | regulation | Europe

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