Russia cuts bookmakers some slack on sports body funding

Russia cuts bookmakers some slack on sports body funding

Russia cuts bookmakers some slack on sports body fundingRussia has cut its bookmakers some slack by reducing their mandatory contribution towards Russian sporting bodies.

In March, Russia’s Ministry of Finance confirmed plans to require all Russian-licensed sports betting operators to return 5% of their sports betting revenue to local sports bodies, with minimum contributions set at RUB 15m (US $241k) per quarter, making each operator’s annual minimal contribution around $1m.

On Tuesday, the Ramblers News Service reported that the Ministry has revised its plans, setting the sports rate at 3% of land-based and online revenue (before tax), with a carveout for mobile sports lotteries. The money collected is to be transferred to the federal budget. The Duma will consider the revised measure on November 2.

Bingo Boom president Konstantin Makarov told that he welcomed both the reduced rate and the decision to transfer the funds directly to the state rather than to individual sports agencies.

Makarov believes Russia’s main sports – football, hockey, basketball, etc. – are already well-funded while less popular sports – swimming, gymnastics, etc. – are going short, so handing more money to the major sports leagues would simply be a case of the rich getting richer.

But Makarov expressed unease as to whether the “proceeds from gambling” referred to in the new proposal refers to revenue – the bookmakers’ take minus payouts to winning punters – or to betting turnover, which would be a horse of a different color.

The Ministry of Finance has been seeking ever greater contributions by bookmakers over the past year, including a 10% tax on online sports betting revenue and significant increases in flat-fee payments to each of Russia’s 12 economic regions if operators wish to take bets from residents in those regions.

Makarov’s Bingo Boom is a member of the Bookmakers Self-Regulatory Organization (SRO), which saw its first member ( launch a Russian-approved online site this week. Two other Bookmakers SRO members – Bingo Boom and Fonbet – have since confirmed plans to launch their own Russian-licensed sites in November.