Three years ago, the process of legalization of gambling began in Ukraine. After more than eleven years of existence outside the legal boundaries, the gambling market gradually began to revive as a separate area of economic activity and was to become part of the global entertainment industry. However, the full-scale invasion of Russian troops into Ukraine prevented the evolutionary process of developing the gambling business.
In particular, the Parliament has not been able to find time to implement the entire complex of tax changes necessary for the full-fledged functioning of the new market, and the Government only recently agreed on the conditions for the implementation of the State Online Monitoring System (SOMS), which was supposed to become a key element of monitoring the activities of all legal gambling establishments in both offline and online market segments.
At the same time, it is worth noting that the process of reforming and legalization of gambling is not only about the adoption of the relevant law, the development and application of fiscal changes, the implementation of supervision and control systems, etc.
The legalization of gambling, first of all, is about building a clear and structured model of the gambling market with stable and transparent criteria for its operation. That is why the reform requires making some changes to the legislation in order to distinguish between the work of casinos, slot machine halls, lotteries and bookmakers.
Why is this important? Because the current legislation and the specific law regulating lotteries activity actually allows for the imitation of various types of gambling by lottery operators, and various shady businesses take advantage of this. With the development of legal gambling, the situation only gets more complicated, because if lottery operators used to mainly imitate the operation of slot machines and bookmakers before, the same operators have learned to imitate the functioning of online casinos. This has a rather negative impact on both the operation of legal gambling organizers and the revenues of the state budget, as lottery taxation has its own specifics.
What can and should be done to regulate the situation and solve this problem:
- Amend the relevant lottery law and prohibit lottery operators from accepting live bets on sports events in toto lotteries;
- Prohibit the use of coefficients not only for determining the winning amount, but also for determining the return amount of the bet made in the game ticket, for determining the future payment, etc.;
- Outline in detail in regulatory documents (for example, license conditions) which equipment can be used to conduct lotteries, so that there is no imitation of slot machines;
- Introduce significant penalties for imitating other types of gambling by lottery operators.
All this meets the basic requirements and needs of the state regarding the legal gambling market, the most important of which are the following:
- Maximizing the cash flow that comes from players precisely through legal gambling companies, which allows for accounting and control of turnover and tax revenues;
- Maximizing tax revenues as a result of ensuring transparent accounting and comprehensive supervision;
- Preventing the use of gambling business for money laundering or avoiding taxation.
Ensuring these needs is a joint task of business and the state, but it is the legislators who should create the basis for this.