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NEWS 19 January 2015

Czech Republic eyes increased regulation

By David Cook
The Czech Republic government is planning to impose a point-of-consumption tax on foreign online gambling operators offering their services in the country.

International operators would have to pay a 20% revenue tax which could rise to 30% at a later stage.

This could force some operators to leave the market, with Betfair general counsel Martin Lycka stating: "If next year the Ministry chooses a new strategy, it is likely that the big players including Betfair [could] leave the Czech (market) and stop accepting bets.”

A number of operators use the same WorldPay payment processor, which has improved the government’s knowledge of their financial records

The move is part of a new government strategy to tackle gambling, and follows an announcement in December that gambling was to be treated in line with drug reduction policies, with the word "drugs" replaced with “addictive substances and gambling” in a policy document.

Gambling is legal in the Czech Republic but the government is aiming to place heavier regulation on the market after being ordered to do so by the European Commission.

A vote was taken in January last year to ban gaming machines in 23 city districts, while a current tax rate of 20% across all gambling types is to be replaced with a variable rate that could reach as high as 40%.

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