EU Allows Lowered Taxes for Danish Online Casinos

12/02/2011
By Pamela PattersonGoogle

Danish officials recently legislated new tax codes that position Danish casinos at a significant advantage to their non-Danish European counterparts.  The big surprise is that the EU commission gave full authorization to the cuts.  Since Denmark has been known for having a particularly high tax right, the new tax cuts are a big surprise in the European market.  There are those who are quite upset about the decision and those who actually see it as a golden opportunity.

 

The biggest losers of the new codes are the established “brick & mortar” casinos.  They pay a gross tax that is approximately 300% larger than the new online casino tax rate.  Considering the massive disparity between the two rates, many in the land-based casino industry consider the new tax codes “state-aid.”

 

The other EU internet casino operators actually see this as a golden opportunity.  Though at the moment they are being undercut by their Danish counterparts, now that the EU commission has green-lighted the low taxation rate, it is only a matter of time before the other casinos can justly request equal treatment.  So while in the short run they might loose some business, in the long run they’ll be able to hold on to a larger share of their gross profits.

 

The question remains – was this really a wise choice for Danish legislators?  While they did see it as an opportunity to grab a share of the highly competitive European market, they must have known that it will only be a matter of time before the other EU member states engage in similar measures in order to protect the interests of their local industries.

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