Czech gov’t takes credit for gambling revenue rise


czech-republic-gambling-revenueThe Czech Republic has offered financial figures to support the claim that its ‘get tough’ approach to overhauling its gambling regime is paying off handsomely.

Last Friday, the Czech Ministry of Finance published statistics showing that its gambling market generated revenue of CZK 39.3b (US $1.78b) in 2016, a 29% improvement from 2015’s result, which had fallen 3% from 2014’s total. The state’s share of 2016’s bounty fared even better, rising 38% year-on-year to CZK 10.5b.

Deputy Finance Minister Ondřej Závodský credited the rise to the government’s ongoing efforts to stamp out illegal gambling and channel the nation’s gamblers to legal (and taxable) operators. The government claims to have reduced the total number of slot machines by 20k over the past three years and has shut around 300 illegal gambling shops since the start of 2017.

Závodský further claimed that the increase in gambling revenue was proof that the government’s decision to dramatically hike gambling taxes hasn’t been the death of the industry, as had been widely predicted by the tax plan’s critics (although the tax didn’t officially kick in until January 1).

Závodský also claimed victory in the government’s war on unauthorized online gambling operators, saying that 50 of the 55 major internationally licensed online gambling sites the government had targeted last year had voluntarily exited the Czech market, while the government issued orders to block the domains of the remaining five laggards, two of which subsequently withdrew their services from the market.

That said, the new Czech online licensing regime has to date authorized only five operators, and only one of these – The Stars Group’s flagship PokerStars brand – hails from outside the country. Yet Závodský claimed that international operators were “constantly asking for licenses.”

International firms have also been asking for a break on the Czech requirement for online gamblers to register accounts in person, a significant hurdle for operators who lack a retail presence in the country. The government has authorized its so-called Czech Point system, a network of 7,500 public administration centers, to handle such online signups but operators claims the set-up still favors domestic operators such as Sazka, Synot and Fortuna.