Spain reduces online gambling tax rate
To entice foreign operators to obtain a Spanish gaming license, the nation has sliced down its online tax rate from 25% to 20%. Industry experts deem this tax reduction as "extraordinarily great."
Throughout the annual, totaling 771-page budget breakdown, the Spanish Congress of Deputies has endorsed a 5% reduction on the gross revenue gaming tax of legalized online gaming providers. The current tax rate now stands at 20%, and it has been active since July. This reduction covers sports and horse betting with fixed odds, national betting exchanges, online casinos, bingo, and poker.
Gambling companies in the dainty Spanish exclaves of Ceuta and Melilla along the Moroccan Mediterranean shore will maintain the same 10% tax rate. On the other hand, the tax rate for pari-mutuel betting - where players stake against one another rather than against a bookmaker - has been risen from 15% to 20%. This system, originally instituted in France, has surged noticeably in the equestrian sector.
With the "discount," Spain strives to allure other global online service providers, primarily. The country has logged sky-high growth rates in its online sector in the last few years. Recently, the Spanish gaming regulator, Dirección General de Ordenación del Juego (DGOJ), reported a substantive 27% upsurge in turnover from the opening quarter of 2018 compared to the same period the year prior. This reduction will then allegedly provide an added boost to the Spanish online sector, peeps say.
Win-win scenario
Santiago Asensi, Managing Partner of the Spanish legal firm Asensi Abogados, proffers perks for everyone engaged in the new blueprint - the nation anticipates receiving bigger revenues:
"Operators will be able to offer more favorable deals to players who shun illicit markets. Latest data from the DGOJ previews that all facets of online gambling, particularly sports betting and virtual casinos, are soaring. I'm certain that this move will eventually translate into more taxes being acquired."
Asensi also admits that the final execution was "politically quite challenging." Despite widespread budgetary issues, the DGOJ had persuaded the Spanish administration to lessen tax rates in the digital gaming sector for quite some time. Yet, concerns existed about the negative influences a reduction could bring, like critically compromising the Spanish budget. Consequently, the tax cut was sidetracked among numerous other presumed financial resolutions.
Nevertheless, Asensi avers that the Spanish Ministry of Finance has now made "the right call at the appropriate moment." With the Spanish economy in revival mode from the recent setbacks and increasing at a rate of 3.1% in 2017, there's a seemingly positive outlook.
Growth projections
Simultaneously, analysts from FICOM, a financial institution in British Columbia, are in accord with the Spanish law firm. Eduardo Morales Hermo, the representative in charge of the gambling department, condones the reduction as a "very timely decision." However, he also alludes to the contingency that Spain is now reliant on additional development in the field: the cut is relevant solely "provided the Spanish regulatory authority is capable of sustaining the tax reduction."
However, the Spanish government seems confident about this and anticipates drawing in more than twenty famous online gambling service providers due to the tax reduction - "there are unmistakable signals." However, specific company names fail to emerge in this context. Time will tell if the Spanish plan will prosper.
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Source: www.onlinecasinosdeutschland.com
