The Czech Republic Ministry of Finance has announced plans to raise revenues by increasing taxes on gaming, tobacco and alcohol. According to CDC Gaming Reports, bingo, live games and lotteries could face the biggest increases, from 23 percent to 30 percent.
Other forms of gaming, such as fixed-odds betting, would be increased from 23 percent to 25 percent of GGR, and the current 35 percent tax rate on gaming machines would remain the same.
If approved, the increases will take effect in January 2020. The Ministry defended the tax hikes, saying they will help “increase the public budget,” funding hikes in pensions and public sector wages.
The proposed amendment to the gaming tax law “divides the rate of tax into three levels, according to the harmfulness of individual gambling, in the same way as the government’s draft Gambling Tax Act of 2015,” the legislation stated.
MP Miroslav Kalousek of the country’s Chamber of Deputies has come out against the plan “disproportionate and unnecessary.” He told Pravo News, “We can divide the word ‘gambling’ into socially acceptable activities and addiction. There is a big difference between slot machines and a bunch of employees in a workplace contributing towards a ticket. For lotteries, I would leave the rate of taxation at the current level.”
Jan Volny, vice-chairman of the ANO 2011 Party, said, “Personally, I am a little worried not to overdo it and avoid gambling in the grey market. Current tax rates on live games and lotteries is sufficient—30 percent is a lot and could be counterproductive in collecting taxes.”
And Jan Bartošek of the Chamber of Deputies agreed that an increase in tax rates could “lead to an increase in illegal gambling”.
According to Prague Morning, higher taxes on spirits and gaming should boost budget revenue by 1.3 billion crowns (US$57 million) in 2020.
The proposal must be approved by the parliament to take effect.
