Ukraine Posed to Lower Tax Burden on Gambling Operators

The Verkhovna Rada, Ukraine’s Parliament, has supported a bill that is designed to reduce taxes on gambling operators in its first reading.

On Thursday, 15 July, 252 members of the Parliament voted for Bill 2713-D, which will lower taxes for those organizing gambling and lotteries. The bill argues that the previous annual fee for online casinos of $200,000 per year is one of the highest in Europe and, therefore, too high.

In its place, the bill sets forwards plans for a fixed tax rate that will be based upon either income or gross gaming revenue. A tax rate of 10% has been proposed for operators of online casinos and poker games.

The bill also suggests a tax rate of 12.5% for operators of slot machines and gambling in land-based casinos, while bookmakers will be taxed at 5% and lottery operators at 10%.

Furthermore, in addition to these set tax rates, gambling operators will also have to pay a basic income tax. However, in good news for players, any winnings from gambling and lotteries will be exempt from personal income tax and military tax.

Online gambling in Ukraine was only legalized in July 2020 by the Verkhovna Rada, at which point lawmakers argued that the industry should bring in between $150 million and $200 million in tax revenue.

However, earlier this year, the Scientific and Expert Management Committee of the Ukraine Parliament warned lawmakers not to reduce taxes. The Committee argued that there is not enough evidence to support a reduction in gambling tax. Furthermore, the Committee also said that a good tax policy is needed to minimize problem gambling and to encourage operators to contribute to organizations that support responsible gambling.

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