Can Online Gambling save the Portuguese economy?
08 July 2015
At the end of April, President Anibal Cavaco Antonio signed a gambling law in Portugal. The reforms were supposed to promote the opening of a market that was previously monopolized. The government hopes to get € 25 million out of new licensees that will fill the chronically cash-strapped pockets at least in some way. Until now, gambling has only been limited only on Santa Casa da Misericordia in this country because of the gambling monopoly. In the past, Bwin wanted to sponsor the Portuguese soccer league in 2005 and thus conquer the market but this was blocked by the government but Bwin put other activities into place. There was a version in Portuguese the website, which resulted in a regulation that blocked offshore gambling sites from accessing from all Portuguese ISPs. The Portuguese Government has now changed its attitude towards gambling due to economic problems. A € 78 billion loan from the EU Commission, the European Central Bank and the International Monetary Fund in 2011 saved the country from bankruptcy, but the economy has not yet fully recovered.
Economic problems of the Portuguese government have intensified over the past year, when the country decided to leave the financial rescue program of Europe, which led to tax increases that were apparently too high as criticized. The tax rate for online casino and poker operators is 15% of the gross gaming revenue, if less than € 5 million are made annually by the operator with a jump of 3% per € 1 million of income over € 5 million, up to a maximum of 30 % from annual revenue of € 10 million. The Remote Gambling Association sees the proposed 8 to 16 percent tax as discouraging for new potential entrants in the online gambling market into the country. Also the fact that Santa Casa got the offline sports betting monopoly with lower tax rate than online competitors is being criticized. The poor Portuguese economy has high hopes for this system. Since the new regulations have already come into effect, we will soon see how successfully the new regulations will support the economy of Portugal.