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Lack Of Professional Approach To Legalization Of Gambling

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Lack Of Professional Approach To Legalization Of Gambling
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The necessity of legalization of gambling in Ukraine has been the topic of interest for a long time. The new government, at the initiative of President Zelensky, has been trying to do this for almost a year now. Experts gave hundreds of comments about this process, journalists wrote dozens of articles, and deputies held many meetings of various working groups. In general, the relevant bill has undergone a number of changes and for a long time has been evolving step by step to an increasingly acceptable form: the general opinion of the market is that the law should be the same for everyone, everyone is ready to certain compromises, and even a high fixed cost of licenses is considered acceptable when the tax on gross gaming revenue (GGR) is abolished. But today the improvement of the bill hit up against the interests of the lottery pool of deputies, who are trying in every possible way to maintain the monopoly position of the lotteries and the associated gray schemes of work of other types of gambling. For this reason, the bill 2258-d on second reading runs the risk of entering the session hall with a number of fundamental problems that will simply nullify the positive effect of the legalization of gambling in Ukraine.

The motivation of the deputies from the lottery circle is obvious, they simply work off the corrupt rent of their patrons. But the motives of the deputies close to President Zelensky are not clear. In case of collapse of legalization or failure to get the expected results, this initiative will turn into a pile of stones that will be thrown at the President by both the opposition and other enemies without hesitation. Especially considering the fact that the President took this issue under his personal control.

Two main factors have caused the current unfavorable situation regarding the legalization of gambling in Ukraine: 1) the subjectivity of certain influence groups (strongly represented by the lottery pool of deputies), and 2) an exclusively theoretical understanding of the mechanism of work and specific features of the gambling business, which can be observed in the statements made by the head of the relevant committee, Daniil Getmantsev. Thus, instead of a broad discussion with future gambling operators, which could contribute to the development of a realistic draft law, we get a substitute for lottery “wishlist”, and an ordinary incompetence.

It will take more than one article to describe all the mistakes of legalization of gambling “in the Ukrainian style”. But nevertheless, the most striking moments can be singled out, without the resolution of which all the previous work will go down the drain.

So, the biggest problem is that the work on the relevant law is carried out without regulating the tax aspect of the organization of gambling. This approach may result in gambling operators paying taxes of 50-60% of profits for doing business legally. In this case, legalization will remain only on paper, as well as the long-awaited income to the treasury. Therefore, it is now extremely important to start a broad discussion on the tax burden for the gambling business. Since the budget of Ukraine needs fast money, and setting up an online monitoring system to track gross gaming revenue (GGR) requires considerable amount of time and specialist training, it would be logical to keep high license fees, but abolish the GGR tax. To understand the numbers, we want to remind you that for one license for 5 years, gambling operators in Ukraine will have to pay (ed. – take into account currency rate fluctuations): a casino – from $5.8 million to $20 million, depending on the number of rooms in the hotel; bookmakers – more than $21 million; lottery distributors – $14.7 million; gambling rooms – $145 thousand; online casinos – $2.4 million. At the same time, legislators plan to establish the GGR tax in the range of 18-25%, in spite of the bill 2713-3, which abolishes the tax on gross gaming revenue (GGR).

In general, world experience provides a choice between two options – either a high license fee or a GGR tax. More precisely, with a GGR tax a license fee may be levied, but then its amount is set at a very low level. In fact, a high fixed license fee is a tax on gross revenue paid in advance. Here are some examples from world experience.

In Britain, for example, a one-time fee for applying for a gambling license is €5,730, and a staff/ management license is about £330. The head of a gambling establishment is also obliged to pay an annual fee to ensure that his current license continues to be valid. The annual license fee depends on the gross turnover of the company. Gambling in England is subject to two taxes: 15% tax on total gaming revenue, and 18% income tax.

In the Netherlands, taxation on the organization and conduct of gambling is also quite high. Casino operators must pay a 29-percent gross revenue tax on games. In addition, they must also contribute 1.5% to the development of the gambling association and 0.25% to the fund against drug addiction.

Swedish casinos are obliged to pay a tax of 18% of their total gaming revenue. For doing business in the country you also need to purchase a license. It can cost from 6 to 70 thousand euros.

In Malta, the gaming tax makes up 5% of the revenue generated from certain gaming services during the relevant tax period. The tax on gaming devices in Malta varies from 12.5% to 30% for different types of licenses. Malta gambling management requires a company applying for a gaming service license to have a minimum share capital from 40 thousand euros to 100 thousand euros, depending on the type of gambling establishment in terms of profitability.

In France, the rules for calculating tax rates are as follows: the gambling turnover tax is 8.5%, and income tax is additionally paid at the standard rate of 28%.

In addition to taxes, all casinos also pay certain fixed fees. So, the budgets of municipalities on a daily basis receive 12 euros from the first roulette that opens and 6 euros from each subsequent roulette that opens.

Thus, the tax on GGR is usually used in those countries where there is no license fee or it is symbolic. In most countries where gambling is legalized, the authorities understand that gambling brings sufficient revenues to the budget, but it requires an adequate tax base.

To introduce the GGR tax, an optimal monitoring system is needed. It shouldn’t be overloaded, the way our parliamentarians do this, striving to stuff everything possible and impossible into monitoring. This approach is an evidence of a superficial and purely theoretical knowledge of the authors of such ideas. For the GGR tax, the most important thing is to control the entry and exit of funds.  For example, if 2 million UAH was brought during quarter, and 1.8 million UAH was given away as wins, then out of 200 thousand the GGR tax will be calculated. Everything is extremely simple. It is better to transmit information in the online monitoring system in non-personalized form and in a package, rather than in real time format and with all the data about the player, because otherwise, any halting will lead to an interruption in the operator’s work or to an unintentional violation of the law. But until such a simple and effective system is offered, it is better to use a high license rate and not charge the GGR tax.

If the gambling business is nipped in the bud, then the budget will not get any money. Therefore, the philosophy of the attitude to this type of business needs to be changed, it is necessary to create an adequate tax base and equal conditions for all operators. In response, the state will receive both substantial revenues to the budget and substantial amount of money for charity. Historically, gambling money goes to support social projects. For example, in France, theaters were built on taxes from the organizers of gambling establishments, and a famous opera house was built in Baden-Baden (Germany) on the tax revenues from the gambling industry. In the Netherlands, the representatives of the gambling industry sponsor the football championship, and in Canada – the annual stage of Formula 1 auto racing. In the USA, casinos finance basketball and hockey clubs.

In many countries, the distribution of tax revenues from the gambling business goes under special budget items. In Denmark, 65% goes directly to the Ministry of Culture and is directed to the development of sports and cultural life. In Finland, profits from lotteries and casinos are directed through the Ministry of Education to finance the development of national culture, and state revenues from betting on horse races are used to stimulate the development of national horse breeding and to conduct equestrian competitions.

For centuries, the authorities of various states have been convinced that human passions, including excitement, can’t be eradicated and prohibited, and therefore the only adequate solution is to find a reasonable compromise between the state, business and player. Many European countries have accepted such a philosophy a long time ago, and it’s time for Ukraine to finally take this path by creating a competitive market that will: a) be attractive to foreign investors; b) create hundreds of thousands of well-paid jobs, and c) replenish the budget with tax payments.


Source: Latest News on European Gaming Media Network
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Lack Of Professional Approach To Legalization Of Gambling

George Miller (Gyorgy Molnar) started his career in content marketing and has started working as an Editor/Content Manager for our company in 2016. George has acquired many experiences when it comes to interviews and newsworthy content becoming Head of Content in 2017. He is responsible for the news being shared on multiple websites that are part of the European Gaming Media Network.

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Fast Track welcomes PolarLotto: taking online lotto in Sweden to new heights

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Malta, 28th March 2024 – PolarLotto, a leading provider of lotto betting services in Sweden, has just announced a strategic partnership with Fast Track, a leading provider of CRM solutions designed specifically for the iGaming industry. This collaboration aims to propel PolarLotto’s expansion from offline to online offerings, bringing the excitement of the world’s biggest lotteries to Swedish players in a safe and responsible manner.

PolarLotto prides itself on its commitment to transparent and ethical gaming practices, with a focus on player safety and responsible gaming. By teaming up with Fast Track, PolarLotto aims to leverage cutting-edge technology to expand its business model from traditional to online, ensuring a seamless and engaging experience for its customers.

Commenting on the partnership, Benjamin Burstein, CEO of PolarLotto, expressed enthusiasm about the possibilities ahead, stating, “We are excited to embark on this journey of transforming our business with the latest technology and automation tools provided by Fast Track. As we transition to the online space, we are confident that Fast Track’s expertise in custom segmentation, real-time data capabilities, and personalised experiences will enable us to better serve our players and achieve our business objectives.”

Fast Track also expressed confidence in the partnership, highlighting the potential for exceptional results through its Singularity model, which uses AI and machine learning to deliver tailored content to players, at the right time and through the most effective channel. “We are thrilled to partner with PolarLotto and support their online expansion,” said Simon Lidzén, CEO and co-founder of Fast Track. Our tools are designed to empower lean teams to achieve remarkable results, and we look forward to helping PolarLotto maximise their online presence and engagement.”

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Red Bull Gaming premieres ‘Memories of CS:GO’ documentary highlighting the game’s early years

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As the CS2 PGL Major in Copenhagen is set to kick off, Red Bull Media House will unveil a captivating feature-length documentary, “Memories of CS:GO – The Early Years,” an ode to one of the most influential games ever made.

This film takes viewers on an immersive journey through the origins and evolution of Counter-Strike: Global Offensive (CS:GO), featuring personal accounts and defining moments from several of the most legendary figures of the game.

The 90-minute documentary, narrated by Counter-Strike commentator Henry “HenryG” Greer, chronicles the remarkable trajectory of CS:GO, from its grassroots beginnings to becoming a global esports phenomenon.

Produced by Red Bull Media House, the film captures the essence of the game through the eyes of its most well known players, including Olof “olofmeister” Kajbjer Gustafsson, Patrik “f0rest” Lindberg, Richard “shox” Papillon, Gabriel “FalleN” Toledo, and Jarosław “pashaBiceps” Jarząbkowski, among others.

The documentary’s release is timed to precede the playoff stage of the PGL Major Copenhagen, scheduled for March 26, 2024. It will premiere on Red Bull Gaming’s YouTube channel at 21:00 CEST, offering viewers worldwide an insider’s perspective on the beloved game.

Event Details:

  • What: Premiere of “Memories of CS:GO – The Early Years”
  • When: March 26th, 2024, at 21:00 CEST
  • Where to watch: Red Bull Gaming’s Youtube Channel
  • The “CS:GO Memories” documentary can be viewed shareit.redbull.com

 

The post Red Bull Gaming premieres ‘Memories of CS:GO’ documentary highlighting the game’s early years appeared first on European Gaming Industry News.

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Ten Square Games ready for a new development opportunities in 2024

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2023 ESPI package

The following documents in pdf format are equivalents of the official Consolidated Financial Statement which were reported in ESPI (download in the zip file above)

2023 Consolidated Financial Statement

2023  Management Board Report on Activities

Independent Auditor’s Report on the Audit of Annual Consolidated Financial Statements

Link to the stream

Link to the chat with individual investors

Presentation

Factsheet

Financial data

Transcription of the conference and Q&A session

For complete press release visit tensquaregames.com

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