German gaming tax passes finance committee

Germany’s gaming tax bill, which sets the tax rate for online slots at 5.3 per cent on turnover, now heads to a vote in the Bundestag.

Germany’- The Bundestag’s Finance Committee has passed Germany’s gaming tax bill, paving the way for a vote on the floor of the legislature.

The bill, which has been highly criticised by many gaming operators and associations, proposes a 5.3% tax on turnover for online slots and poker when the newly licensed market launches under Germany’s State Treaty on Gambling.

Germany’s online gambling legislation is due to come into force on July 1, although a transition regime is allowing existing operators that abide by the future rules to operate already.

The bill will now advance to a full vote in the legislature on its second and third readings. That’s expected to happen on June 23 or 24 and is largely viewed as a formality since the bill is expected to pass.

Antje Tillmann, a CDU/CSU spokeswoman on financial policy, said in a statement: “With today’s law, we have passed a Germany-wide uniform regulation for the taxation of online games of chance such as virtual slot machine games and online poker.

“Both online poker and virtual slot machine games will be taxed in the future, as will racing betting, sports betting, public lotteries and draws. This means that online gaming will be taxed at 5.3 percent of the amount staked.”

She said the tax would also apply to unlicensed igaming, claiming: “Even if a game of chance is operated illegally, for example because there is no licence, taxation takes place.”

Legal challenges against Germany’s proposed gaming tax for online casino

Although the bill is now expected to pass a vote in the legislature without resistance, two legal challenges have been filed withe European Commission.

The European Gaming and Betting Association (EGBA) and the German trade association DSVW have both filed illegal state aid complaints arguing that the tax regime would create an unfair advantage for the land-based gaming sector in Germany.

There are fears that the tax rate would make licensed operators uncompetitive and drive players to the black market as a result.