EGBA calls for renovation of Portuguese gambling taxation

The Portuguese authorities should unify all gambling taxation at the same rate to encouraging channelisation into the regulated market, the European Gaming and Betting Association (EGBA) has said.

EGBA Secretary General Maarten Haijer said the current tax on betting turnover was forcing Portuguese consumers “to find more competitive gambling products” via unregulated websites, thereby exposing them to inadequate consumer protection safeguards.

As its rationale, EGBA cited a recent Portuguese media report that up to 75% of Portuguese online gamblers were gambling via sites which are not licensed within Portugal.

Online operators are currently taxed at a special rate, known as the IEJO, which varies on the type of activity being conducted.

Fixed-odds sports betting and fixed-odds horserace betting is taxed on turnover at varying rates between 8% and 16%.

Previous plans to unify this taxation rate at 25% of gross gaming revenue were shelved in October, when they were left out of the Portuguese government’s 2019 budget.

A six-person working group made up of several representatives from the Portuguese government and regulator, Santa Casa da Misericórdia de Lisboa (SRIJ) have been conducting an independent review of the IEJO taxation rates since January. The findings of this group, which have not been made public, were reported in March.

The EGBA has called the current system of taxation “discriminatory” in imposing different tax rates for different types of games. These fluctuating rates, the EGBA claims, make a Portuguese licence “much less attractive” for online gambling companies including some of its members based elsewhere in the EU.

At present only one EGBA member has a Portuguese licence, but the EGBA said that many more “are very interested” if the tax regime became non-discriminatory and better suited to the online gambling environment.