Denmark Confuses EGBA and Industry with New Taxation PlanPublished July 1, 2020 by Lee R
Denmark's citizens may stray into risky play of shore if slapped with a 25% tax increase.
Progressive Denmark is facing a backlash over new taxation increases.
EGBA Trade Concerns
The European Gaming and Betting Association EGBA is taking issue with Denmark's newly announced plans to increase gross gaming revenue tax from 20% to 28% by 2021.
The EGBA is concerned that this tax would unduly discourage users and drive more players towards illegal offshore betting where Denmark citizen's will be unprotected by the well-known measures Denmark has established for self-exclusion and related protections.
GGR Already Dropped
Think Tank H2 Gambling Capital has already reported a significant 17% drop in gross gaming revenue for Denmark's licensed operators for 2020.
Prevailing Deposit Issue
Before COVID, in January 2020, the country’s gambling market was already dealing with limited deposits.
Unsightly data projections from the impact of the new tax in Denmark are not pretty, with channelisation likely to drop 12 points to 76% from the current 88% by 2024—further reverberating into a near 25% drop for operator revenue as well, to the tune of some 4.5 billion Danish Kroner (£537.512 million).
EGBA Secretary Speaks
EGBA secretary general Maarten Haijer called for “a delicate balance to be struck between taxation levels and control of the market. If taxes are too high, customers will look for more competitive websites in the offshore market.”
Proposed Tax Impact
H2 estimates that the suggested climb in taxes would increase offshore gambling nearly 80%. Some prognosticators are suggesting moderation to a less substantive 1% increase to 22% which would soften the blow on onshore operators.
Haijer Calls Out Legislators
Haijer further called for Denmark legislators to be wary of letting their own interests conflict with hard data:
“Legislators should beware of the entirely predictable consequences of a substantial tax increase and balance their monetary priorities against the interests of the Danish consumer.”
Hopefully, Denmark's legislators can ultimately adapt a common ground consistent with their leadership model for effective protection of citizens from gambling harm.