As part of its 2020 budget, the government in Denmark will raise iGaming tax. It expects that this move will bring in an extra 20 million Danish Kroner (DKK) per year.
The new tax rates will come into effect from 2021. Rather than the current 20% of gross gaming revenue (GGR), operators will be obliged to pay 28% from then onwards. The current rate had been the same ever since the country’s iGaming market launched in 2012.
Online vs. land-based
Despite these planned hikes, online gambling in Denmark will still be taxed at a lower rate than land-based versions. For example, casinos pay 45% GGR and then an extra 30% on revenue surpassing 4 million DKK.
Meanwhile, gaming machines have to pay 41% GGR. They must then also pay 30% on restaurant-based machines generating over 4,000 DKK. In gaming halls, the same rate must be paid on earnings over 250,000 DKK.
The Danish government says that the new revenue generated from these tax changes will fund various initiatives. These include extra money for healthcare, as well as education and the welfare system. It will also go towards the DKK25bn Green Fund, aimed at investing in environmentally-friendly businesses and more.
The tax changes were announced after the Social Democratic Party-led minority government received support from other political parties. These include the Red-Green Alliance, Socialist People’s Party and Social Liberal Party.
iGaming in Denmark
Earlier this year, the Danish Gambling Authority announced that new measures would be introduced. The code aimed to provide clarity in multiple areas. These included a benchmark on gambling industry practices related to advertising, player protection and more.
In Q3 2019, gambling revenue in Denmark fell slightly. It generated 1.61 billion DKK in total, which was a 1% decrease from 2018’s Q3 total of DKK 1.63bn.