Update: European Commission to Investigate Proposed Danish Online Gambling Tax Regime

Tax proposals give unfair advantage to online gambling sites?

Following land-based operators’ complaint about the latest taxation proposals, on Dec. 14, the Dow Jones news agency reported that the European Commission is starting a formal investigation of the Danish proposed low tax regime for online gambling sites, in an attempt to determine whether it gives internet operators an unfair advantage over land casinos.

Denmark is introducing a more open regulatory and licensing regime for Internet casino games, in order to open its gambling market. The proposed tax regime involves a flat tax of 20 percent on online gross gambling revenue, compared with up to 75 percent for land-based casinos and gaming halls.

This difference in the treatment is the subject of the commission’s revision, as it may establish an unjustified competitive advantage for online casinos. The commission stated that it has already received two complaints alleging the planned measure violates EU rules.

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