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Lithuanian lawmaker's plans to increase gambling taxes to fund addiction prevention measures cleared a major hurdle after members of the country’s legislative body voted to approve it this week.
Draft Law IX-326 would amend the country's Law on Lotteries and Gambling Tax to increase the tax rate for lotteries, slot machines, table games, bingo, totalisator, betting and remote games from 20 percent to 22 percent of gross gaming revenue (GGR).
Lawmakers who prepared the tax increase bill argued that increasing gambling industry profits in recent years requires the state to “properly balance the amount of taxes applied”.
Lithuanian gambling revenue reached €222.2m in 2023, a 13.5 percent increase compared with 2022, according to data provided by the Gaming Control Authority, which is within the Ministry of Finance.
The draft law still needs to be voted on again by the Seimas for it to be adopted.
If approved, the law will come into force from January 1, 2025.
It is estimated that the change in the tax rate would generate an additional €4.4m annually for the state budget, which the government says will be used to “educate the public about the possible [caused] harm of problem gambling”.
In 2023, almost €6.7m was collected in the Lithuanian budget from gambling taxes.
The changes are part of a wider ongoing legislative discussion in Lithuania aimed at reducing the risk of addiction and tackling gambling-related harms by amending its regulatory framework.
There have been several notable gambling tax increase proposals in Europe in recent months.
Trade groups in Sweden have warned that plans to lift its taxes for online gambling to 22 percent of GGR, up from the current 18 percent, would lead to the licensed gambling market share dropping between 1.2 to 2.5 percent and could create more than 1,000 problem gamblers.
Similarly, trade groups in the Netherlands have been warning of the impacts of a proposal to increase the gambling tax rate from 30.5 percent to at least 37.8 percent.
Recently, Romania significantly increased the country’s licensing and taxation costs after amendments to its Gambling Act entered into force in October 2023.
