Ukraine’s Rada begins progress for a simplified gambling tax code

Ukraine stakeholders have declared progress on the gambling tax framework discussion required to finalise the country’s federally approved Gambling Law.
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Ukraine stakeholders have declared progress on the discussion of the gambling tax framework required to finalise the market terms of the country’s federally approved Gambling Law.

Last week, its federal parliament, the Verkhovna Rada, approved the first reading of amendments made to the Gambling Law’s tax code.

Alongside outstanding technical certifications, the Rada is yet to decide on the final tax framework of the Gambling Law, which acquired its federal passage last July.

An appraisal made by the Committee of Tax and Finance recommended that the Gambling Law maintain a single 10% GGR tax rate applied across all licensed verticals, replacing the previous tiered % tax framework.

The Committee’s amendment has been carried forward by the Rada, which will apply Ukraine’s standard 18% income tax on licensed businesses with GGR charges to be deductible.

Notably, the Rada decided to stop the costly ‘triple fee’ licensing charges made on operator’s slot machines, betting points and online casino games inventories.

For online casinos, the Gambling Law will keep its fixed $200,000 yearly licensing fee, with operators that have paid the ‘triple fee’ charges being credited with future annual licence payments.

Despite operator pleas, the Gambling Law will maintain its tax on player winnings, which will be charged on players net winnings of €1,500+, in which casino operators must apply a 24-hour win/loss calculation on a player’s wagering activity.

Though the Rada continues its slow progress on finalising the Gambling Law’s tax policies, the first reading of the gambling tax code should be identified as a significant development as amendments are approved ahead of the Rada summer recess.

As developments stand, Ukraine’s gambling ongoing tax saga will likely conclude before the end of 2021.