As long as lotteries don’t pay taxes, the gambling business won’t be properly regulated

In developed countries, lotteries are one of the most important sources of revenue for state budgets in the gambling sector. Abroad, this sector is actively regulated, and the state receives significant amounts from taxes and fees, which are used for the development of medicine, sports, culture, and other areas. At the same time, the situation in Ukraine remains unclear, despite some changes,  that have recently in Ukrainian legislation . The most pressing issues are the payment of taxes by lotteries and the illegal imitation of gambling. The situation with lotteries remains uncertain, which significantly reduces their potential to fill the state budget. Everyone loses from this.

The example of foreign jurisdictions shows that, with proper regulation, lotteries can be a significant source of revenue for the state budget, bringing in billions of dollars in taxes and license fees.

In the US, lotteries pay taxes ranging from 20% to 30% of GGR (gross gaming revenue) annually. These are significant funds that go towards economic development and job creation in other industries. The state can also use these funds to finance healthcare, education, social assistance, etc.

In European countries, lottery regulation has been in place for a long time, and in most jurisdictions, they are generally equated with gambling. In Lithuania, €41.7 million was collected in taxes on gambling and lotteries in the first half of 2025, of which €14.7 million came from lottery operators. I would like to remind you that the population of this small country is approximately 1.83 million people, which is about half the actual population of Kyiv.

Germany is another striking example. In 2024, the total economic benefit of lotteries to the budget reached approximately €3.42 billion. During the same period in the UK, the national lottery contributed around £937 million (approximately €1 billion) to the country's budget.

What unites all these jurisdictions is a clear legislative framework that defines tax rates, licensing and revocation conditions, penalties for illegal activities in the field of gambling and lotteries, etc. In Ukraine, unfortunately, we cannot speak of any stability or clarity in the field of taxation of gambling or lotteries.

In our country, the lottery sector has been effectively "outlawed" for a long time, but continues to operate nonetheless. This is due to the lack of tax conditions and a licensing system for lotteries, which allows lottery operators to remain in a "gray area" without paying taxes and license fees. Moreover, by remaining in the shadows, they imitate gambling with impunity, creating difficulties for legal organizers. All this once again highlights the ineffectiveness of existing regulatory mechanisms, or simply their absence, because the lottery market could potentially become one of the most significant contributors to the state budget.

To change the situation, it is necessary to unify the tax burden on the lottery sector and create transparent and understandable licensing and regulation rules. This will improve competition in the market, attract more investors and operators, and, most importantly, ensure stable budget revenues. Only with such a system will lotteries be able to realize their potential to fill the state budget, because as long as lotteries do not pay taxes according to uniform rules, there can be no talk of order in the gambling business.