Swedish Gambling Authority notes potential channelisation impact but says it will monitor developments over potential increase
The Swedish Gambling Authority (SGA) has said it has no “substantive views” on a proposed four percentage point GGR tax hike in the market.
The proposal, which was put forth in September, could see the GGR tax rate rise from 18% to 22% as Sweden’s government looks to retcon an initially low rate of tax when the market re-regulated in 2019.
At the time, the rationale behind the 18% tax rate was that a “precautionary” level would allow the market to flourish.
Now, the Swedish government is looking to increase the tax as channelisation stabilises and state coffers are in need of a boost.
Once the government returns to parliament in the spring of 2024, it will put forward the proposal. If the changes are agreed upon, the new tax regime would come into effect on 1 July 2024.
In delivering its verdict on the proposal, the SGA said that while it has no major concerns, it did note a potential impact on channelisation.
The regulator said: “The SGA sees that an increase in the tax on gambling may effect, among other things, the channelling rate.”
It pointed to downturns over the past two quarters for total market turnover in the country, which it said was “particularly evident among licence holders”.
The SGA added: “Thus, there are already some changes in the gaming market that could lead to a reduced tax base, although it is uncertain whether the decline is temporary or more permanent.”
When the proposal was announced in September, Swedish Trade Association for Online Gambling secretary general Gustaf Hoffstedt slammed the tax hike.
He said: “The announcement from the government is deeply disappointing, above all because 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.”