In good news for the country’s domestic gambling industry, the Spanish government has proposed cutting its current tax for certain gambling operators from its current 25% of gross gaming revenue to 20%, a reduction of a whopping 20% overall.
The proposal was announced by the Minister for the Treasury and Public Administration, Cristobal Montoro, as part of the larger draft budget presentation. It is principally aimed at encouraging more licensed operators to take part in Spain’s current boom in gambling revenue. The measure is also aimed at reducing the share of the market dominated by foreign operators, which has been a thorn in the side of the Spanish authorities for some time – indeed, virtually throughout the gambling boom that Spain has enjoyed in recent years.
The market looks set to continue growing, and there has understandably been developing interest in Spain’s gambling market from international operators. As the fifth largest population in Europe, there is tremendous potential for further growth there. The proposed tax cuts would also of course help to raise current operator’s margins and enable the key operators in the field to consolidate their existing market positions.
The proposal itself, it should be noted, is still at an early stage, with the lower house currently giving it consideration as part of the draft budget. Any actual changes to law are a good way off, but there’s every indication they may be a smart step for the government to take at this time and the proposal is generally expected to proceed through the house.
The cuts, it sees, would not apply to all operators, but to those offering fixed-odds sports betting, exchange betting, and fixed-odds horse racing. Sports betting still pulls in the lion’s share of revenue, generating just over €100 million in revenue across the past quarter. Analysts are predicting that the current market gross gaming revenue of €556 million will rise into the realm of the billions within the coming years; the projection is for it to hit €1.22 billion by 2023.
The Spanish economy has been showing slow signs of improvement in recent times, and as we’ve seen, the Spanish gaming market is in the midst of a long-term and significant boom. The online gambling market is widely regarded as being ripe for further growth, with room for additional competition, and this proposal is aimed at fueling that growth.
