Austrian Casinos foresee potential shutdown of up to five gaming establishments due to proposed tax legislation
Austria's esteemed gambling empire, Casinos Austria, is facing a potential crisis as the new federal government's tax proposals threaten to leave smaller casinos struggling to survive.
According to Casino Austria's General Director, Erwin van Lambaart, the government's budget consolidation plan, which includes an increase in betting tax from 2% to 5% starting April 1, 2025, could ultimately push smaller casinos towards the brink of extinction. This anticipated revenue boost is projected to generate an extra €50m. Furthermore, the gambling tax is set to rise by 10%. The projected additional tax revenue from gambling for the public sector is expected to climb to €129m in 2026 and reach approximately €150m by 2027.
Sounds like a win-win situation, right? Well, not so fast. The increased taxes could make it a tough ride for the little guys in the gambling industry, as they typically operate on slimmer profit margins and lack the flexibility to adapt to this financial squeeze.
The new tax structure is not just about higher betting fees; it's about a broader trend of tighter regulatory grip, as suggested by adjustments to the concession and gaming taxes on lotteries and electronic lotteries. Although these changes are not explicitly aimed at casinos, signs are getting louder that the gaming sector could face stricter financial regulations, ultimately impacting all forms of gambling, with smaller casinos being the hardest hit.
On the flip side, larger casinos or those connected to broader tourism and entertainment groups may have a better chance to ride out these financial waves through economies of scale or diverse revenue streams.
It's a risky bet, and only time will tell who's going to come up trumps in Austria’s gaming industry. But one thing's for sure – the new Austrian government’s financial and tax plans are inching towards putting more pressure on Casinos Austria’s smaller casinos, directly reducing their profitability through increased betting fees and the likelihood of hiked gaming taxes. Other tax reforms, while less directly relevant, could create a more challenging overall business environment, making it difficult for smaller casinos to stay afloat.
The new Austrian government's financial and tax plans inadvertently threaten smaller casinos, as the proposed increase in betting tax could make it challenging for them to remain profitable due to their slimmer profit margins and limited adaptability. This tougher regulatory environment could potentially impact all forms of casino-games at smaller establishments, not just Casinos Austria.
