The Swedish Gaming Federation (BOS) is reiterating its firm disapproval of the government’s proposal to raise gaming levies. They contend that increasing duties will only serve to bolster the illicit gambling sector.
The suggested scheme would witness taxes on wagering rise from 18% to 22% commencing in July 2024. BOS Chief Executive Gustaf Hoffstedt censured the blueprint, stating it weakens the government’s own objectives for a well-controlled gaming market. He cautioned that steeper taxes would push players away from lawful, authorized providers and into the clutches of unlawful gambling platforms.
The government has previously declared an aim of maintaining illegal gambling below 10% of the market, guaranteeing that the vast majority of wagering activity occurs with licensed and regulated businesses. However, BOS posits the new levy scheme will make this objective unattainable and will instead result in a surge in illicit gambling. They cite figures from March of this year that demonstrate the legal market share has already plummeted to 77%, and even lower to 72% for internet-based casinos.
Hofstetter further noted that research from Copenhagen economics scholars indicates the ideal taxation level for a nation should fall within the 15% to 20% bracket. Exceeding the 20% threshold, he posits, leads to diminished returns from various avenues, ultimately resulting in a decline in tax income over time, as per the Laffer Curve principle. He contends that there’s no data to suggest Sweden can operate outside these parameters without negatively impacting the regulated market, drawing parallels to the period preceding the re-regulation of Sweden’s gaming sector. These arguments were presented by Hofstetter during an appearance on the Huddle podcast in October, shortly after the unveiling of the proposed tax changes.