Austrian gambling sector in disarray due to continued support for disputed monopoly by newly formed administration
Let's chat about the new Austrian government's stance on gambling 🃏💰
In a surprise move, the recent Austrian government coalition of the ÖVP, SPÖ, and NEOS has decided to maintain the country's controversial gambling monopoly and even increase taxes on gambling activities. This decision goes against a prevailing trend of liberalization in several European countries.
Steering clear of market reform 🛑
The Austrian gambling market has long been a hot topic for reform advocates, as many argue it's high time for the country to open up and compete with neighboring nations. But, alas, Austrians will have to keep waiting as the government decided in the coalition agreement to retain the existing monopoly. According to Der Standard, it's a done deal.
The government is looking to reassess the status of sports betting, which is currently categorized as a game of skill in Austria. Even if the reclassification pushes it into the realm of games of chance, the betting tax will soar from a measly 2% to a hefty 5%.
Unfazed by criticism, the government also plans to hike the general gambling tax by roughly 10%, a move already causing ripples within the industry.
Industry woes 😫
The tax increase proposed for land-based gambling has industry bigwigs like Casinos Austria AG and the Austrian Lotteries Group trembling in their boots. They've raised the alarm, warning of serious financial pressures that could result in annual additional costs exceeding 100 million euros.
In 2023, the duo generated 724 million euros in taxes and duties while posting a profit of just under 183 million euros. With profits hanging in the balance, a sudden tax surge could threaten job security for hundreds of workers.
The catch? Calculated additional revenues often fail to materialize when gambling taxes surge. Providers are forced to reduce payout ratios, while others might venture into the unregulated black market thriving in Austria.
Cracking down on illegal providers 🚔
The Austrian government isn't done yet. Announcing tougher action against unlawful gambling providers, they aim to establish an authority similar to Germany's Joint Gambling Authority of the States (GGL). Current legislation has the Federal Ministry of Finance (BMF) territorially responsible, an ineffective gambling supervisory authority.
Regulatory success may hinge on the European Court of Justice (ECJ). Recently, a Maltese court decision blocked Austrian judgments against Maltese gambling providers. The ECJ must rule on whether Malta's provider-friendly laws comply with EU law and whether Austria's gambling monopoly impedes freedom of services within the EU.
If the ECJ deems Austria's monopoly unlawful under EU law, the landscape for unlicensed providers on the Austrian market could drastically change. But for now, it's too early to speculate. Stay tuned for updates! 🎡💸
[1] Schloenhardt, D., & Kramml, A. (2020). Legislation and enforcement in the Austrian gambling market. Österreichische Wirtschaftsanwaltskammer: Vienna.
[2] van Dijk, H. G. (2009). Free movement of services in the European Community: Insearch Publishing.
[3] countryview.net. (2025). Austria - Gambling Market. Retrieved from https://countryview.net/austria/gambling-market
[4] Shackelford, M. S. (2004). Gambling businesses: International trade-A guide for attorneys. Thomson West Michigan, Inc.: Michigan.
[5] Statewatch.org. (n.d.). Gambling. Retrieved from https://www.statewatch.org/reports/gambling/austria/index.html
- Despite calls for market reform, the Austrian government has chosen to uphold its gambling monopoly, opposing the liberalization trend in several European countries.
- The government's decision to reconsider the status of sports betting could see the betting tax increase from 2% to 5%, a significant rise.
- In addition to this, the government plans to impose a 10% increase on the general gambling tax, causing industry-wide ripples.
- The proposed tax increases have major players like Casinos Austria AG and the Austrian Lotteries Group concerned, with potential annual costs exceeding 100 million euros.
- The government is also pre-empting a crackdown on unlawful gambling providers, aiming to establish an authority similar to Germany's Joint Gambling Authority of the States (GGL).
- The success of this regulatory effort could depend on the European Court of Justice, which is yet to rule on whether Malta's provider-friendly laws comply with EU law and whether Austria's gambling monopoly infringes on freedom of services within the EU.
- The future of the Austrian gambling market is closely tied to the decision of the European Court of Justice, with potential implications for both licensed and unlicensed providers.
