In review: licensing and taxation of gambling activities in Germany
The basic legal framework for gambling in Germany is the Interstate Treaty 2021. It was introduced on 1 July 2021 and marks the fourth attempt of the German states to create uniform and EU-law-compliant gambling regulation. The responsibility for regulating gambling is vested in state and municipal level regulators. Other state legislation regulates gambling. Federal laws also influence gambling, such as the Race Betting and Lottery Act, the Trade Regulation Act and the Criminal Code. The Regional Council of Darmstadt is responsible for the licensing process for sports betting.
In Germany, the type of taxes imposed on gambling operators depends on the gambling product in question. Land-based casino operations are subject to gross gaming revenue- based taxation. Slot machine operators are also subject. Uniform taxes must be paid for virtual slot games, online poker and sports betting. Online casino games will remain subject of VAT. The new tax rate is harshly criticised by the industry bodies. It contravenes the objective of the Interstate Treaty 2021 to channel players from the unregulated online gaming market into the licensing regime.