Polish Ombudsman Wants To Overhaul Gambling Tax

October 19, 2021
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A top official from a government-appointed business group has joined the chorus calling for Poland to reform its betting tax rates.

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A top official from a government-appointed business group has joined the chorus calling for Poland to reform its betting tax rates.

Kamil Rybikowski, the legal counsel of Poland’s Small and Medium Enterprises Ombudsman, has praised a recent report that calls on the government to replace a 12 percent revenue tax on bookmakers with a gross gaming revenue (GGR) tax, indicating the ombudsman’s broad support for the proposed fiscal measures.

The current ombudsman, Adam Abramowicz, was appointed to his post in 2018 by Prime Minister Mateusz Morawiecki and leads a body that represents the interests of small and medium-sized enterprises (SMEs) throughout the country.

The ombudsman’s legal representative, Rybikowski, spoke at a recent session of the Consumer and Entrepreneurs Protection Team of the Sejm, the lower chamber of the Polish parliament.

During the session, lawmakers, government officials, industry representatives and other stakeholders discussed a report former deputy finance minister Konrad Raczkowski recently submitted to the Ministry of Finance.

The study was filed as part of a public consultation on a legislative tax package recently approved by the government and currently being debated in parliament.

The report proposes imposing a GGR tax on the country’s gambling industry, pointing to the experiences of other European countries, such as Romania, Denmark and the UK.

“The conclusions drawn from the report by professor Raczkowski are very interesting, and, above all, they are confirmed by the experiences of the last few years,” Rybikowski said.

“If this report is transformed into a legislative proposal, which we would very much like, preferably with the support of the Ministry of Finance, then I think that the ombudsman’s office will always adopt a positive approach to proposals to … reduce the taxation of legally operating entrepreneurs, and also combat those who don’t want to participate in the legal market competition,” according to the ombudsman’s representative.

In his report, Raczkowski said that an “optimal level of a GGR tax on gambling is 20 percent to 25 percent of GGR,” and he proposed to scrap the country’s 12 percent revenue tax, which he claims “is equal to a 55 percent to 65 percent GGR tax”.

The study’s conclusions are in line with the demands formulated by Poland’s gambling industry.

Local gambling industry association PIGBRiB has in the past called on the cabinet to introduce a 20 percent GGR tax on bookmaking, claiming that the country’s tax policies make the Polish market unattractive to the majority of established international bookmakers.

Another report, commissioned earlier this year by Poland’s national lottery operator Totalizator Sportowy, proposed that the Polish authorities replace the 12 percent revenue tax with a 40 percent GGR tax.

Łukasz Kulesza, the deputy chairman of the Sejm committee and a lawmaker for the opposition Confederation (Konfederacja) party, said that the existence of the unlicensed gambling market in Poland was “a symptom of a problem related to the market’s obvious negative reaction to either too many regulations, or to the excessively high taxation” of bookmakers.

“In my opinion, deregulatory or fiscal solutions … are the only way to decrease the size of the black market,” he said.

The parliamentary team is chaired by Michał Jaros, an MP for the opposition Civic Coalition (KO), but its members include lawmakers from both the ruling PiS party and opposition parties such as the Left (Lewica), Konfederacja, and Polish Coalition-Polish Peasants' Party (KP-PSL).

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