Portugal Proposes 25% Tax on Online Gambling Revenues

portugal gambling regulationsThe government of Portugal has proposed a 25% tax on the revenues generated from online gambling in the country. To meet the budget demand, the government is looking forward to making essential changes in the gambling sector.

Earlier, the punitive tax was imposed by Portugal on revenues generated from sports betting, but now it could be abolished. The preliminary budget details are published recently where several changes in the gambling sector are proposed.

The government is planning to levy a flat 25% tax on all kinds of revenue or turnover generated from gambling. It will replace the earlier sliding scale of 15 to 30 percent which applied to online casino and poker turnover as well as 8-16 percent tax that was applied to revenues from online sports betting.

This new flat tax rate will apply to gross online gaming revenue. However, it is just a provisional proposal, and there could be many changes made in the final budget. If such rate is implemented, it will give a big jolt to the iGaming industry in Portugal.

Why Such Changes?

The earlier tax system is to be blamed for its inability to increase the revenue volume from the online gambling activities to different operators having a valid Portuguese license.

The first license was issued in May 2016, and since then only 7 other casino operators have received the permit. Till now, 8 operators hold 13 different licenses for poker, online betting and casino play.

The gambling industry in Portugal has been performing well in this year, and the FIFA World Cup 2018 was mainly responsible for its success. In the second quarter of 2018, online casino revenue generated was $43.4 million out of which the government received $19.6 million at a rate of 45%.

This is indeed a very high tax rate proposed by the government, and it is stifling the operators from making further investments to attract prospective players.

Some talks are going on regarding the structure and implementation of online gambling taxes. Serviço Regulação e Inspeção de Jogos do Turismo de Portugal, the gambling regulator in Portugal, has obtained inputs from various stakeholders in January 2018 for making changes in the tax system for online gambling revenue.

The Portugal government has received all the proposals in May this year, and it seems that they have listened to some of the complaints and grievances of the operators.

Gambling Tax Changes in Europe

Portugal is not the only European country that is looking forward to amending the existing gambling tax structure in the country.

Like for instance, Ireland is also planning to double the current gambling taxes. The current tax rate in Ireland for the betting revenue is 1 percent and is likely to rise up to 2%. This new move from the government will add approximately $57.5 million in the state coffers every year.

Also, Greece is looking forward to doubling the tax rate in the gambling sector. A raft of changes is brought in the gambling laws including the development of a casino resort in Athens. The government is proposing a new tax rate of 35% on the gambling revenue in the country.


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