Online Revenues from Gambling Taxes Boost Greece's Funds
In the first five months of 2022, online gambling revenue in Greece surged by over 127 percent compared to the same period last year, reaching an impressive 56.95 million euros. This significant growth not only exceeds the initial revenue target for the whole year but also indicates a promising future for the online gambling sector in Greece.
However, the high taxation imposed on this industry could potentially hinder its growth and competitiveness. Operators licensed by the Hellenic Gaming Commission are required to pay a 35 percent tax on their gross gaming revenue (GGR), a rate significantly higher than many other European countries. This tax, combined with substantial licensing fees and strict regulatory controls, places Greece among the highest tax brackets in Europe.
The Greek government introduced a new online licensing system in October 2019, requiring providers to pay approximately five million euros for a seven-year online gambling license. While this supports strong regulatory control, it may also limit market entry and competition due to high fees and taxes.
The increase in tax revenues is beneficial for the financially struggling Greek government, but the high tax rates could potentially increase operational costs for license holders, potentially reducing profitability or leading to higher costs passed on to players.
In contrast, countries like the UK have lower tax rates on gambling revenue, fostering a more competitive and open gambling market with potentially greater consumer choice. Many European jurisdictions have varied tax rates, often ranging from single digits to mid-20% levels on GGR, with Greece among the highest.
The Greek government revised the taxation of online sports betting and online gambling in July 2021, a move that has been met with criticism from the German Association for Telecommunications and Media. Providers such as GGPoker have passed on the taxes to their German customers, while illegal offers remain unaffected by this high taxation and licensing costs in Greece.
The COVID-19 pandemic has unfortunately led to a surge in illegal gambling, causing all actors to lose hundreds of millions of euros. In most European countries, including Belgium, Bulgaria, Estonia, Finland, Ireland, Latvia, Luxembourg, Austria, Sweden, Slovakia, and the United Kingdom, no taxes are paid on winnings from gambling. In Greece, taxation for online gambling winnings depends on the amount of winnings, with rates ranging from 0 percent for amounts under 100 euros, 15 percent for amounts between 101 and 500 euros, and 20 percent for winnings over 500 euros.
If the development on the gambling market remains the same, tax revenues from the online sector alone could reach 130 million euros or more, a promising figure for the Greek government. However, the high taxation and regulatory controls could potentially constrain industry growth and competitiveness relative to markets with lower tax burdens.
- What about introducing lower tax rates for sports-related activities in Greece to attract more operators and foster a more competitive sports betting market?
- If the Greek government lowers the tax rates on sports, it could potentially lead to an increase in sports-related activities and revenue, while also making the industry more competitively positioned compared to other European countries.
