Greece to vote on 35% GGR tax next week
Government expected to approve the rise from 30% as part of wider tax overhaul
Greece’s long journey towards a fully-regulated online gambling market took another twist yesterday as the government revealed plans for a five percentage point rise in the GGR tax to 35%.
The proposed rise in taxes is expected to be voted on next week and will apply to all gambling products.
The Greek gambling market primarily consists of OPAP’s offline monopoly and 24 online operators on interim licences currently paying a 30% GGR levy.
Sources in Greece told EGR rumours around a rise in taxes have been circulating for a number of weeks, with one suggesting that a senior politician even floated the idea of a 45% rate.
The country’s beleaguered government has set a strict timeline to vote on the change, which sits in a bill containing many other tax increase measures.
However, while sources said the hike was likely to gain approval by Greek politicians, any tax amendments must be signed-off by the country’s international bailout partners.
“Everybody has been telling the government that they shouldn’t raise it so in that sense there has been some kind of consultation but no formal discussion about the tax,” said Teemu Lehtinen, a consultant in the Greek market.
“And the timeline is very strict – if it goes in the bill – this is going to be voted on by the start of orthodox Easter which is the end of next week.
“We don’t know what the international partners, that means Troika, think about the gambling tax yet. But if they agree to it being a part of the package then frankly I don’t see how we can stop it happening. Under the circumstances it will be hard for Greek politicians to vote against raising gambling tax when all other taxes are taking a hike.”
A rise in tax rates could affect the amount of foreign interest in the market, which the government has committed to reforming, including the issue of permanent licences.
“I don’t know how much difference it will make,” said Lehtinen. “Operators will need to take a look at the overall picture and there are so many unknowns elsewhere.
“But if you have a lower EBITDA margin 15-20%, then a 35% tax on the top line is going to make your life very difficult. This is not going to make a future Greek online gambling market attractive.”
The changes would also mean the existing five cent levy on OPAP tickets and bet slips will be revoked, a move which Lehtinen said didn’t make sense.
“If you do the maths – it doesn’t add up. The five point increase in gaming tax – provided that nothing changes in GGR from online and from OPAP – means an ?80m tax intake.
“If they put the five cent levy on all OPAP gambling slips and tickets, and I mean the monopoly products which they can price without competitive concern – there’s about 10 billion each year – it works out as ?500m extra revenue. So you can see the best of the scenarios is a ?420m loss to the government – it doesn’t make financial sense.”