Europe’s Remote Gambling Association (RGA) has accused the Greek government of State Aid over their recently unveiled Gambling Law. The RGA’s main gripes are that OPAP, the state owned gambling industry monopoly, is afforded privileges that only the goddesses would get back in the day. Namely, it’s pointed out that the Greeks have gone completely the other way to Denmark in relation to the issue of State Aid. It means that while all online firms are paying 30% Gross Profit Tax (GPT), OPAP pays nothing on any offline proceeds it makes.
RGA chief executive Clive Hawkswood commented, “There are concerns that the new law provides tax benefits for OPAP‟s land-based operation with the aim of increasing its value prior to a proposed sale of the Government’s share.”
Is it really Greece’s fault that they went a little overboard with the plate smashing?! They have to get the money to buy all that China back from somewhere.
Hawkswood added, “We are fully aware of the fiscal pressures on the Greek authorities at present, but they do not justify the imposition of anti-competitive tax provisions which benefit the existing monopoly gambling provider over private online operators soon to be licensed in Greece. Not only does such action not conform with EU State aid rules, but if implemented, it will have a damaging impact on the private sector and associated growth and employment opportunities, as well as curbing competition and consumer choice. As such, we feel compelled to take this action and challenge the Greek authority’s favourable tax treatment of the part state-owned gambling operator OPAP.”
The country unveiled its new gambling law in August and under the plans, online operators pay a 10% withholding tax on all winnings. That is decreased to wins over €100 only for OPAP. This company also increased the length of time its monopoly lasts on land-based gaming for another 10 years to 2030 late last month. If it helps the sale and encourages an economic recovery then I suppose it’s good. It’s still a bit cheeky though and unlikely to fly as far as the EC is concerned.
Looking at the RGA itself, the fact that they represent a large number of publicly traded gambling industry firms says a lot. European markets are important to these firms as they are effectively shut out of the world’s most lucrative online gambling industry market – Asia. It explains why the RGA has issued an opinion and is fighting against the high rate of GPT.
Denmark’s case was remarkably similar to this one apart from the fact it was the online firms being favored. In that case, the EC decided that the system of taxation didn’t constitute state aid, stating “the positive effects of the liberalisation of the sector outweigh potential distortions of competition.”
A similar outcome to the one in Denmark is not expected here and the EC is likely to again rule that Greece’s plans are not compatible with EU law. It will be interesting to see how long it is until Greece is without a home in the EU.