Ukrainian parliament reinstates 18% turnover tax for gaming
Danylo Hetmantsev, chairman of Ukraine’s Finance Committee made the announcement on instant messaging service Telegram.
In his post, the chairman claimed this will bring a minimum of UAH1.5bn (£32.1m/€37.1m/$40.8m) per year into Ukraine’s budget.
The 18% applies to turnover only and does not apply to to gross gaming revenue (GGR). This is outlined under article 136.4 of Ukraine’s tax code.
Yaroslav Zheleznyak, People’s Deputy of Ukraine, said on Telegram that Ukraine’s parliament had “settled the taxation of online casinos that had brazenly “forgot” to pay the 18% tax on online casino gross gaming revenue”.
He added that “despite the opposition of two factions – EU and Motherland- knocking down my edits, we returned the taxation for GGR online casino”.
In plenary session on 10 August, the chairman of Ukraine’s legislature Verkhovna Rada, Ruslan Stefanchuk, announced an amendment of Ukraine’s tax code under draft law 6529.
Increasing the number of sanctions
Along with amending the tax code, draft law 6529 added to the already expansive list of sanctions that could be imposed by Ukraine’s National Security and Defence Council.
Amid Russia’s war in the country, the gambling industry has found itself targeted for alleged Russian connections. Earlier this year, Parimatch suspended its operations in Ukraine after Ukrainian president Volodymyr Zelenskyy signed Presidential Decree No 145/2023 into law.
This placed sanctions on 287 companies – including betting companies – and 120 individuals.
In June, a petition that asked Zelenskyy to review Ukraine’s decision to sanction Parimatch reached 25,000 signatures.
Previous tax rules
In July 2021, Ukraine’s legislature passed a bill that set the tax rate at 10% for all forms of gambling. This had been approved by the Committee on Finance, Tax and Customs Policy.
At this time, however, operators were still required to pay a 18% general corporate tax rate.
The tax rate was contested by the Scientific and Expert Management Committee. It said that there was little justification for lowering tax on licensees.
New anti-money laundering law
Last month, a new law went into effect in Ukraine. This law outlined procedures for companies at risk of money laundering and terrorist financing.
In addition, unplanned inspections could be carried out by Ukraine’s regulator, KRAIL. The frequency of these would depend on the level of risk each operators carries for money laundering and terrorist financing.