Czechia Online Gambling Taxes Holding Back Growth

Published Sunday, August 14, 2016 -
Czechia Online Gambling Taxes Holding Back Growth

The European online gambling industry has many jurisdictions to deal with that are changing the rules all the time.

The Czech Republic now renamed Czechia has made headlines in the online gambling news with the announcement a short time ago that the country had liberalized online betting. There is a lot of controversy surrounding the Czech President Miloš Zeman decision to sign into law legislation to open up the Czech gaming market to offshore gambling service providers.  Only five licensed gambling providers operate in the country which speaks volumes about the situation created by the new legislation.

The most likely cause of the lack of license applicants may be the excessive tax regime imposed on the offshore operators. After the standard 19 percent tax on corporate income online gambling operators also are required to pay 35 percent of gross gaming revenues on casino games and sports and lootery are taxes at a consistent 23 percent.

Czech Finance Minister and Deputy Minister Andrej Babis´ who revealed real opposition to gambling originally launched the proposed tax regime in 2014 calling for a 40 percent levy to help with the social problems created by gambling.

The Deputy Minister has been the focus of the left-wing “hacktivist” collective Anonymous which made their opposition to the new online gambling laws known by attacking the online divisions of Babis’ food and agriculture businesses.

Anonymous was making a statement when it hacked the Deputy Minister that it was not happy with the proposed internet censorship in Czechia. Anonymous’  YouTube video stating that “The Finance Ministry led by Andrej Babis gets almost limitless power to censor the internet. It is time to move against it.”  The hack was that move, taking down two Babis’ websites recently including his holding company Agrofert´s website.

Babis did explain his position recently, “the indirect costs for the state stemming from such gambling are several times higher than the revenue it collects. That should be made even.”


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