If the state introduces a tax on profits from gambling, will it recognize stakes as expense? This was a question a reporter asked the head of the Gambling Commission Kaloyan Krastev.
He said it should.
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The frequent tax whims of Finance Minister Simeon Dyankov cause strong reverberations in the public space. There will be a tax on profits derived from games of chance. This is how the jackpot tax was created.
Representatives of the casino industry did not dare to object in principle the tax but asked for recognition of the costs that people have incurred to get to the smile of Fortune. From gaming industry are adamant that the budget revenues from gambling will significantly decrease if profits of the lucky ones are taxed.
What is the status of this business?
More than 100 gaming halls and casinos in Bulgaria have closed doors in the last year and more than 10,000 installations have been withdrawn from service due to new requirements of the Gambling Act, according to industry representatives. The industry has shrunk by about 42 percent over the past three years, shows an analysis of the Bulgarian Gaming Association. Revenue for the treasury of the games of fortune in 2011, were over BGN120 million, but they are by about 2.5% less than in 2010.
Only a few months later – after the introduction of the total ban on smoking in public places, companies in the industry have lost more than 20 percent of their revenue. If next year the state decides to tax the wins of the lucky few, this will supposedly reduce the number of players and gambling will shrink their profits even further, which will reduce the tax paid to the Treasury. Finally, when making the calculations the revenue from individuals will turn out to be much smaller and will not compensate for the decline in corporate tax revenues in the state budget.
Legislators need to be precise with the new texts, asked Angel Iribozov, Chairman of the Bulgarian Association of Manufacturers and Operators in the Gaming Industry.
According to industry representatives, the state must establish procedures under which casinos and gaming halls and internet operators will collect the information on money that players pay in chips or tokens and to compare the amounts they receive when they exit from the casinos.
This mode is fully applicable to online gambling, said Robert Stocker II, Chairman of the gaming laws of the American Bar Association. He argued that the flow of data on the internet is the easiest to follow and institutions only need to create a system for processing.
Outflow of players from legal gambling, and their inflow into the informal sector expect the gaming industry as a result of a tax on the wins, said Rossi McKee of the Bulgarian Association of Entertainment and Gambling. According to the industry, if a ten percent tax must be introduced, then a clear definition on what a win is has to be made.
The same amount could be taxed repeatedly warned Rossi McKee. For example, a player could bet BGN10, then immediately gain them back. And again, where, if there is such a tax, in fact he would be taxed twice on his or her own money.
