High taxes imperil Bulgarian gambling industry

Speaking at a pre-conference press briefing prior to the opening of the Eastern European Gaming Summit in Sofia today (Tuesday), gambling trade association chief Angel Iribozov said that high taxation has seen the number of gambling establishments shrink from 975 in 2008 to just 653 this year.

Iribozov. who chairs the Bulgarian Trade Association of Manufacturers and Operators in the Gaming Industry (BTAMOGI), added that despite the contraction in the gaming industry, the state continues to gather the same amount in tax, with operators contributing BGN 120.9 million to the Treasury.

The new licensing regime for online gaming sites and a 15 percent tax introduced at the beginning of of 2013 had seen access to over 100 gambling websites blacklisted due to licensing issues, prompting the Association to protest to government that taxation was too high for online gambling, according to a report on the press conference by the Standart newspaper..

Supporting Iribozov’s view, Joerg Hofmann, vice president of the Gaming Law Committee of the American Bar Association, said: “High taxes on gambling help the black market and when people want to get into the blocked site, they will find a way.”

Bulgaria’s legalisation and licensing of online gambling has been confusing, with practical licensing arrangements lagging behind the introduction of the empowering legislation, and blacklisting commencing before operators could obtain licensing .

The result has seen top management changes at the national regulator. The Standart reports that thus far only one online gambling operator, the Malta-registered Eurofootball, has been licensed for Bulgaria and is in line for a second licence for its Sofia-based subsidiary. Another (unidentified) site is also well advanced in the application process and is expected to receive a licence soon.

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