Spanish government slashes online gambling tax by one fifth

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The Spanish government has announced a five percent tax reduction for online operators, setting the figure at 20 percent of gross gaming revenue.

The amendment, included in the House of Deputies 2018 budget breakdown, follows a 27 percent year-on-year increase in online gambling revenue for Q1 2018.

“All areas of online gambling are expanding,” said managing partner of gaming law firm Asensi Abogados, Santiago Asensi, “particularly with sports betting and online casino games.

“I believe that these new measures will also lead to more tax being collected.”

The reduction will apply to online fixed-odds betting, sports betting, fixed-odds horse race wagering and online casinos.

Taxes levied on pari-mutuel sports betting will also be reduced to 20 percent, having previously been set at 22 percent, in order to level the rate with state-owned betting services.

Though the standardisation of tax rates benefits most Spanish operators, pari-mutuel horse racing and pari-mutuel pool betting tax rates will also be changed to 20 percent, despite previously being set at only 15 percent.

Anticipated reductions of the 10 percent tax rate in the Spanish overseas territories of Cueta and Melilla on Africa’s North coast, predicted to attract gaming firms considering relocating from Brexit-affected Gibraltar, did not form part of the budget.

The tax amendment follows extensive lobbying from Spanish regulator DGOJ, as well as a general 3.1 percent economy expansion throughout 2017 across the country.

The online gambling industry itself grew to achieve $190.4m in Q118, a 27 percent increase from the prior-year-period, after reaching $653.5 for the whole of 2017.

The figure prompted the DGOJ to reopen and extend its license application process in December, stating “the proper functioning of the regulated online gaming market is fundamental to ensure that gaming activity is sustainable and compatible with social welfare.”

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