iGaming faces tax raise in the Bahamas

The government’s budget plan foresees tax rates as high as 50 per cent for the online gambling segment.

Bahamas.- The Free National Movement introduced the 2018-19 budget plan and announced a major blow to online gambling operators. According to the new budget, the segment would be slapped with tax rates as high as 50 per cent, while users also face a five per cent tax on customer deposits.

The new rates would have local “web shop” operators going from paying either 11 per cent tax on their gaming revenue or 25 per cent of earnings (whichever is greater) plus an additional two per cent cut of revenue to help fund social causes to new variable rates. Under the new regime, companies would pay from 20 per cent on revenue up to US$20 million, 25 per cent up to US$40 million or 50 per cent over $100 million, with other progressive rates in between.

The Bahamas Gaming Operators Association (BGOA) sent a letter to Finance Minister Peter Turnquest calling for a “meaningful consultation” between parts. The body’s attorney Alfred Sears warned about operators being “compelled to seek the intervention of the Supreme Court to protect their rights” should the budget plan succeed.

According to Sears, operators would be paying an “unconstitutional, discriminatory, punitive, irrational and unfair” tax as they would transfer over 90 per cent of their revenue to the government in taxes and licensing fees