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Sweden’s government has proposed an increase in the rate of gaming tax paid by licensed operators from 18% of GGR to 22%.

Proposed tax hike

The proposal was put forward by the Swedish government in its 2024 budget proposition on 20 September.

According to the government proposal, previous research suggested that a tax rate of “just over 20%” could be considered compatible with Sweden’s goal to achieve channelisation of more than 90%.

The current tax rate of 18% of GGR was introduced in 2019 as part of the re-regulation of Sweden’s gambling market.

At that time, according to the government, “a lower tax level was proposed for precautionary reasons.”

Since then, the proposal said, “the gambling market has stabilised and channelisation has increased significantly. In addition, measures have been taken to exclude unlicensed gambling from the Swedish market,” it added.

Therefore, the government suggested, “the reasons for caution when setting the tax level should not be as strong now as during the re-regulation.”

The proposed increase was judged by the government to be a suitable level to strengthen its tax income, “without it leading to too great an impact on the companies and the size of the tax base.”

The new rate is planned to be introduced on 1 July 2024.

The government predicts that the increase would generate additional tax revenue of SEK270m in the second half of 2024, and SEK540m per year thereafter.

BOS response

So far, the proposal has garnered a negative reaction from representatives of Sweden’s licensed gambling market.

In response to the proposed increase, Gustaf Hoffstedt, the secretary general of online gambling association BOS, said it was “deeply disappointing,” adding that “it shows that the government does not understand or has taken to heart what kind of market it is set to govern. 

“Even less has the government understood the vulnerable position that market is in.”

BOS studies recently showed a channelisation rate of 77% in the Swedish market, with specific verticals such as online casino coming in even lower at 72%. 

Hoffstedt pointed out that those numbers also appear to be declining, meaning the rate of channelisation in Sweden is falling.

Even a report published by Sweden’s State Treasury in 2021 showed a channelisation rate of 85%, marking a decline from 2019’s reported rate of 90%.

“We are already far from the state’s goal of at least 90% channelisation, and if this tax increase is approved by the Riksdag, we will soon be down to the channelisation we had before Sweden re-regulated its gambling market in 2019,” Hoffstedt added. 

“Sweden’s government must perform much better than this. There is still time to withdraw the proposal,” he concluded.

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