EGBA Criticizes EU Proposal for a Unionwide Online Gaming Tax
Introduction to the EU iGaming Tax Proposal
The European Gaming and Betting Association (EGBA) has voiced strong opposition to a recent proposal aiming to establish an EU-wide online gaming tax. While the initiative is intended to generate additional revenue for the EU budget, the EGBA has described the plan as impractical and likely to cause significant issues.
The Proposed Unionwide iGaming Levy
The European Parliament’s Budget Committee suggested the introduction of a unified online gaming tax across all member states as part of discussions on the EU’s long-term budget framework for 2028-2034, known as the Multinational Financial Framework (MFF). This idea was put forth to explore possible new revenue streams by taxing the iGaming sector.
It is important to note that this proposal is still in an exploratory phase, with the committee seeking feedback from all 27 EU member countries before proceeding further.
Concerns Raised by EGBA
The EGBA highlighted that implementing such a tax would place a heavy financial burden on legal gaming operators, potentially weakening their ability to compete. This, in turn, could inadvertently promote illegal gambling activities by making unregulated operators more attractive due to lower costs.
The association also warned that the levy could decrease overall tax income for member states, contrary to its intended purpose.
Moreover, EGBA stressed that for this tax to be enacted, unanimous agreement from all member states would be necessary, making it a challenging policy to finalize.
Impact on the Black Market and Consumer Protection
Maarten Haijer, Secretary General of the EGBA, pointed out that because gambling regulations are not harmonized across the EU, there is currently no legal framework to implement or manage such a unified tax effectively.
He emphasized that adding this levy on top of existing national taxes, some of which already exceed 50% of gross gaming revenue, would severely disadvantage licensed operators. This disparity would likely fuel illegal gambling markets, which do not pay taxes and are able to offer better prices and products without adhering to consumer protection standards.
Illegal operators who evade taxes can provide more attractive options to players without the safeguards that licensed entities must follow. Introducing an EU-wide tax would worsen this situation, expanding the black market, compromising consumer safety, and ultimately reducing tax revenues for EU countries.
Maarten Haijer, Secretary General of EGBA
Next Steps in the EU Parliament
Although the committee’s vote was tentative, the European Parliament is expected to conduct a formal vote on the matter soon. Following this, negotiations concerning the budget and the proposed iGaming tax will commence.
