Dutch PokerStars dispute ends as High Court sides with players
Court upholds ruling that PokerStars.eu is licensed in EU and winnings are not subject to 29% Dutch withholding tax
The Dutch Supreme Court has upheld a ruling that Dutch players of the PokerStars.eu site should not pay a 29% tax on winnings in a major victory for consumers.
Judges examined a prior 2018 ruling by the Dutch court of appeal in Hertogenbosch after the country’s finance ministry launched a last-ditch appeal against the decision.
The long-running dispute between the Dutch Tax and Customs Administration (DTCA) and a group of around 75 online poker players centres on claims that PokerStars is domiciled outside the EU, due to it being headquartered on the Isle of Man.
Players launched the case after being charged tax on winnings generated via PokerStars in October 2013. However, the group argued the tax was incorrectly levied due to the assertion that PokerStars.eu is licensed and operated in Malta, which is in the EU.
The customers claimed this was a violation of EU law. Under article 56 of the treaty for the functioning of the EU, there can be no restrictions on services being provided to EU nationals from another EU member state, including taxation.
“After describing the actual course of play of poker online through PokerStars.eu, the court proceeded to weigh the factors related to the organisation of those games that indicate Rational Gaming Europe Limited (RGEL), a company established in Malta or another relevant group company established outside the territory of the European Union,” the ruling stated.
“On this basis, the Court has come to the conclusion that RGEL should be regarded as the holder of the online games of chance offered through PokerStars.eu,” judges concluded.
In addition to ruling in favour of the players, judges at the supreme court ordered the Dutch Ministry of Finance to pay the group’s legal costs.