Ontario steps forward as Kenya stumbles while Greek and German operators chafe against betting limits.
Ontario opens up
With liberal attitudes and a wealthy population, the Canadian iGaming market is nothing if not promising.
However, online gambling has long been dominated by provincial monopolies, blocking Canadian entrepreneurs from their own domestic market and driving players offshore.
On April 4, however, the province of Ontario took a monumental step forward, officially opening up to licensed operators. This makes Ontario the first province in Canada to create a competitive market.
Ontarians are estimated to spend around CAN $500 million a year on gambling over the internet, so newly licensed brands have a lot to look forward to. And it’s always possible that if healthy competition generates tax revenues while ensuring player protection, other Canadian provinces might follow suit.
Stake limits causing friction in Greece and Germany
The much-anticipated regulation of the German market garnered mixed reviews.
While German states were finally able to issue licenses for online casino gaming, restrictions were so tight (€1 stake limit, €1000 monthly deposit limit, etc.) you’d have been forgiven for thinking it was designed to fail.
Some German operators might also share that opinion. According to WirtschaftsWoche, a German magazine, the council regulating gambling in Germany has been named in multiple lawsuits.
For one example, bookmaker Tipico takes issue with the country’s €1000-per-month deposit limit, pointing out that land-based casinos and betting shops have no comparable limits and players could easily turn to black-market operators.
Further south, authorities in Greece are giving operators a reason to be hopeful.
Whereas German operators are likely looking at an uphill battle to have their leashes loosened, the Hellenic Gaming Council is hoping to give licensees some more room to roam. After looking at the results of a recently conducted study, the HGC has recommended to the Ministry of Finance that stake limits be raised from €2 to €20.
Revenues in the recently re-regulated Greek market passed €700 million.
History repeating itself in Kenya
The past several years have been tumultuous, to say the least, when it comes to the online gambling industry in Kenya. An ugly tug-of-war broke out between operators and authorities in 2019 when a steep stakes tax of 20% was introduced.
As many could have predicted, gambling tax revenues dropped once the rates were raised as operators including local giant Sportpesa chose to exit the market instead of paying what they viewed as unreasonable fees.
Sportpesa eventually returned after the tax was lowered to 7.5%.
Now the stakes tax that prompted Sportpesa and Betin to leave the market in 2019 has been re-introduced. The bill would raise the stakes tax from 7.5% back to 20%. The government also intends to impose a 15% excise tax on gambling advertising.
Striking the right balance can be difficult. Governments can rightly expect some tax revenues from gambling, but exploitative tax rates, as we’ve seen again and again, tend to simply decimate the domestic market while driving players to offshore platforms.
Given how authorities in Kenya have such a recent example — their own, in fact — it’s hard to fathom the reasoning behind a return of the 20% stakes tax.
If authorities go ahead with the 20% tax, it could well turn out that Sportpesa pulls out for good.