Greece Plans to Increase Gambling Taxes

Greece Plans to Increase Gambling TaxesSince the Greek government placed a 30 per cent levy on income from online gaming under a new gaming law in 2011, online gambling operators complained to the European Commission. This complaint concerned the fact that OPAP, the Greek betting agency which is state controlled and the largest in Europe, was exempt from this higher level of tax placed on online gambling. OPAP runs sports betting and lotteries in Greece (See article: Licence for Greek State Lottery at Stage 2).
At the moment OPAP pays taxes at 21 per cent since land based gambling was considered as income to be taxed at the usual corporate rate. Also favourable to OPAP is that any winnings over 100 euros are taxed at 10 per cent. Changes to both of these levels of taxation to bring the state controlled company in line with internet gambling operators would see OPAP paying 30 per cent on gross profits and also all of a player’s winnings would be taxed at 10 per cent.The Greek government recently came to an agreement with the European Commission that from the 1st of January 2013, it would place a 30 per cent tax on the gross income from all of the OPAP games and also introduce the 10 per cent levy on every euro won by players. At 30 per cent this tax is well above the 15 to 25 per cent levied in most other countries in Europe. This high rate will have an effect on possible future investment by foreign operators in the Greek online gaming industry.

It will also affect the Greek government’s plans to raise money through the sale of part of its share in OPAP. In 2011 profit from OPAP’s gambling income was 537.5 million euros and analysts predict that the new tax at 30 per cent could reduce this profit by as much as almost 50 per cent.  OPAP has the monopoly on gambling in Greece so this proposed increase in tax has been announced before the European Court of Justice releases a ruling as to whether it can keep this monopoly.

As a result of the bail outs it has received and under agreements with the International Monetary Fund and the European Union, the Greek government must raise 50 billion euros by 2020. In order to fulfil its obligations it has embarked on a major privatisation programme. The proposed sale of OPAP by the end of 2012  is part of this plan but experts believe that the sale should not take place too soon as the new 30 per cent tax has already affected share prices.

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