Gambling is set to become legal in Ukraine, after Vladimir Zelensky signed the new Gambling Act into law in August. The Ukrainian parliament had passed the bill 248-95 in its vote, which then meant that it was sent to the President’s desk for his assent and signature.
According to the bill, online gambling, bookmaking and casinos are all permitted in the country now, but casinos can only be located in hotels. There is a license fee of $1.1 million, valid for five years, which has to be paid by online gambling operators, while the license for bookmakers will cost UAH 70.8 million, that for casinos located in Kiev will be UAH 121.6 million, and for casinos elsewhere in the country will be UAH 70.8 million. Parimatch, which is a Ukrainian gambling operator, has already announced its intention to apply for licenses.
Additionally, the Cabinet of Ministers has approved the establishment of a gambling commission to regulate gambling activities and services, following the passage of the Gambling Act into law. The Commission is scheduled to begin work in November, from when it will be responsible for issuing the various gambling licenses and monitoring gambling activities in the country.
Commenting on this new Ukrainian Gambling Commission Winz casino reported that it will also have the power to control and regulate the industry. This move is expected to reduce the instances of illegal gambling in Ukraine, many of which use state lotteries to work, while it will also bring in employment, investment and job creation, and also increase the government’s tax revenues.
The taxation policy for gambling is yet to be agreed upon in the Ukrainian parliament. There are multiple competing tax bills already under consideration, with different rates on different types of gambling. For example, Bill 2713-D proposes a 5% GGR tax on bookmaking, 10% for online gambling and 12.5% for slot machines. Bill 2713, on the other hand, asks for a 25% GGR tax rate on all types of gambling, while Bill 2713-1 proposes a 7.5% tax on bookmaking, 12.5% on online gambling and 22% from lotteries.
These are just a few of the competing proposals on the parliament floor for the new taxation policy on gambling, and so it could take some time for any taxation laws to be passed. However, it is important that the tax system is fair, since Ukraine’s tax laws are already quite heavy and punitive, and having another heavy taxation program could make Ukraine’s gambling sector uncompetitive when compared to global markets, defeating the purpose of legalizing gambling in the country.
