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The collapse of the French government has torpedoed planned gambling tax increases and left the fate of online casino legalisation hanging in the balance.
France currently has no government after the premiership of Michael Barnier was ousted over a controversial budget law.
That budget contained modest tax increases for the gambling industry, after fears of more meaningful hikes were seen off.
The now ditched 2025 budget was set to increase social security taxes for online betting from 10.6 to 11.6 percent of gross gambling revenue (GGR). That tax sits on top of the 33.7 percent basic rate for internet bookmakers.
Similar tax increases for other gambling sectors were included in the bill, but with Barnier gone, the social security budget is also trashed.
President Emmanuel Macron remains in his post and is responsible for attempting to form a new government.
Despite his promise to quickly name a replacement for Barnier, France’s deeply divided parliament is unlikely to provide an easy path to a new coalition government.
In the meantime, outgoing ministers are planning to introduce legislation that will allow the 2024 budget to carry forward to next year, effectively keeping taxes at their current rates.
The fate of an online casino consultation announced by the previous administration is much less certain.
Plans to legalise what is currently a prohibited sector in France could have died along with the tax increases, having initially begun life in October as a budget amendment.
But an intervention from the land-based casino industry and a cohort of local officials vocally concerned about a potential loss of revenue forced the government to withdraw the amendment anyway.
The government then moved to open a consultation into online casinos, with the clear intent of pushing forward with legalisation after canvassing stakeholder opinions.
Sources say the status of that consultation is uncertain, and is likely to remain so while maneuvering over a new government continues.
When lobbying resumes, the key players in the debate will remain the same, as do their fairly transparent motivations.
Land-based casinos remain concerned about losing market share, but market watchers believe their ultimate aim is to ensure they receive a piece of the pie in any eventual licensed market, perhaps akin to the set-up in Belgium and other markets where online casino licences are tied to their bricks-and-mortar equivalents.
Then there is the formally state-controlled FDJ, in which the government still has a minority stake.
The gambling giant completed its acquisition of global operator Kindred in October.
Kindred has significant online casino operations in a number of jurisdictions and the upside for the betting-focused FDJ of deploying its new online gaming resources in its home market is clear. The national lottery operator already offers both physical and digital instant lottery games, however, and the impact on that segment of legal online gaming may also inform FDJ's position on the issue.
