Ukraine set to reduce taxes for gambling companies

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    Ukraine set to reduce taxes for gambling companies

    Ukraine’s unicameral parliament, the Verkhovna Rada, has supported bill 2713-D in its first reading. 

    The bill intends to reduce taxes for those organising gambling and lotteries, and was voted in favour by 252 Members of Parliament on Thursday.  

    The bill states that the agreed annual fee for online casinos at $200,000 a year is “one of the highest in Europe.»  

    Instead, the bill recommends that there is a set tax rate in place, which will be based on income or gross gaming revenue. 

    The set tax rate will be received by the organisers of online casinos and online poker games at 10%.  

    Those operating slot machines and gambling in land-based casinos will be taxed at 12.5%, while bookmakers will be taxed 5% and those issuing lotteries 10%.  

    In addition to the set rates, gambling organisers will have to pay a basic income tax; however, winnings in gambling and lotteries will be exempt from personal income tax and military tax. 

    It was only in July last year when the Verkhovna Rada legalised gambling in Ukraine; the lawmakers highlighted that the legalisation of such businesses should bring in $150m to $200m in tax revenue.  

    Earlier this year in May, Ukrainian lawmakers were warned by a Parliamentary committee to not reduce taxes.  

    The Scientific and Expert Management Committee of the Ukraine Parliament said there was not enough evidence to justify a decrease in gambling tax.  

    It also said an appropriate tax policy must be in place to minimise problem gambling, and encourage operators to contribute to social programs that address the negative impact of gambling.