Latvia Exploring Tax Increase of Land-based Gambling

Published October 31, 2019 by Mike P

Latvia Exploring Tax Increase of Land-based Gambling

Latvian land-based slot machines and table games could incur approximate 20% tax increases under fresh proposals from the finance ministry.

After initially being proposed by the finance ministry, the Latvian government is currently considering a proposal to amend the taxation of land-based gambling ahead of the nation’s annual budget for 2020. At this time, the changes don’t include increases on the taxation of the Latvian online gambling market.

Rise on Slot Machines and Table Games

One of the first proposed changes to have an impact would be an increase in the flat fee imposed on individual slot machines. In this case, the existing fee of €4,164 would rise by approximately 24% to €5,172.

The second major ramification would be an increase on the annual fee of table games, covering blackjack and roulette. At present, the 2019 annual levy for operating each table is set at €23,400, but could rise by 20% to reach a higher level of €28,080.

Figures for First Half of 2019

By its calculations, the Latvian government has determined the new taxes could potentially generate €9.0 million in revenue. Of course, this is predicated on the country maintaining its present numbers of 8,643 licensed slot machines and 61 table games.

In reporting on the first half of 2019, the government stated that an average of €12,896 was generated per slot machine for €111.5 million in total revenue. For same period, an average €132,164 was earned from every table game for an €8.1 million collective value.

What Comes Next

If the proposal is voted into law, then the government plans to adjust how the tax revenue is distributed. Under the current system, 75% of taxes go to the government and 25% to the municipal region where it was collected. Moving forward, the new split would provide 90% to the government and just 10% to municipalities.

All shall become clear once the budget is ready by parliament. Should it receive approval, expect the changes to be applied as of 1 January 2020.

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