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Struggling EU Economies Turn to RegulationPublished July 11, 2015 by Mike P
Italy and Spain have turned to online gambling as a means of stimulating economic growth, while Portugal could be scaring operators away with high taxation.
Greece’s future as part of the EU is extremely uncertain, but the country had been considering online gambling reform to boost economic performance. The Greeks were not the first to turn to such a strategy, as evident from the examples of Italy, Portugal, and Spain.
Italy’s online gambling market increased by 0.4% to post gross gaming revenue of €748 million in 2014. Revenue generated from casino games grew by 8%, while there was 11% growth for sports betting. The marginal growth of the market is due to a 20% drop for online poker. A liberalisation of Italy’s online gambling market has allowed for new operators to enter and new services like in-play betting to be introduced.
Portugal introduced fresh online gambling legislation at the end of June, forcing the market’s licensed operators to pay tax of up to 20% on gross gaming revenue. Such an extreme spike in tax is one that only the leading operators can consider. Even then, Ladbrokes and William Hill had already chosen to exit Portugal before the new legislation began. More operators could follow in the coming months.
Greek citizens voted against the austerity measures suggested by the EU. And although he won, Greek finance minster Yanis Varoufakis has already left his post. Before the referendum, Varoufakis had thought about ending the country’s national monopoly and opening up the Greek gambling industry to foreign operators. Given the current turbulent situation, it remains to be seen whether this will actually happen.
Earlier in 2015, Spain opened up its online market to admit leading industry players such as NetEnt and Bally Interactive to join the likes of 888 and bwin.party. As a result, the Spanish were rewarded with a 24.5% increase in turnover for Q1 2015 from Q1 2014. Spain’s reasonable approach is one that Portugal could stand to learn from.