After reaching a consensus, the Czech lower house has agreed to make a progress in gambling legislation process and decided to raise taxes on gambling companies, but also to allow foreign operators to actively participate in the Czech gambling market.
According to Reuters findings, the change in taxes will mean an increase on slot machines equal 35% (now it is 28%), and verticals like sports betting and lottery to keep the current level of 23%. The tax is said to bring in the profit of extra 1.5bn crowns, apart from the regular 19% corporate tax that is mandatory at the moment. Moreover, the aim of the legislation is also to reduce the gambling addiction. The country would allow foreign companies to participate in the gambling industry, yet, the Finance Ministry will held the power to close company’s activities on the basis of illegal operations.
Now, the bill must be agreed upon by the Senate.
Then, the second bill will define some boundaries for the use of slot machines and terminals for video lottery.
As for now, Dr. Richard Myslil wrote in Gambling Insider that “At the moment, local operators are subject to local registration and taxes, and claim that foreign operators do not pay any tax and are not validly registered for this business in the Czech Republic, and therefore have a substantial competitive advantage.
“However local authorities cannot exclude foreign operators so easily from the internet market as it has no exact borders and they cannot violate the free movement of services in the European Union.
“Up to now, no direct action by local authorities to block these ‘illegal websites’, other than prohibition of advertising, has been known.”