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Regulatory policy of the state should promote the development of legal gambling

Gambling market's returning to the legal field has been continuing for three years in a row. After the Law of Ukraine "On State Regulation of Activities Regarding the Organization and Conduct of Gambling" was adopted in 2020, which created the conditions for the legalization of gambling in Ukraine, the domestic gambling market is in a state of development. This process continues even during the war.

Despite all the difficulties that the full-scale invasion has added, the gambling industry continues to operate and provide substantial revenues to the state budget. In particular, since the beginning of obtaining the first licenses for gambling activities, legal organizers have ensured overall more than 3 billion hryvnias of tax revenues of the state budget from license fees! In addition to that, over the course of a year since the beginning of the full-scale invasion of Russian troops to Ukraine, they provided more than a billion hryvnias of aid to the Armed Forces of Ukraine, the Territorial Defence Forces, and internally displaced persons.

However, the efforts of only business to develop the industry are insufficient to significantly increase tax revenues from gambling. The state itself should facilitate this process, in particular through the improvement of the legislative framework, first of all, by adopting changes to the tax legislation specified in draft Law No. 2713-д. The implementation of these changes will open the doors of the Ukrainian market for foreign investors.

In addition to that, in order to improve the regulatory capacity and ensure transparent control over the implementation of legislative provisions, it is the time to implement the State Online Monitoring System (SOMS). Setting up its operation in all legal gambling establishments of the offline gambling segment and on the sites of the online segment will provide an opportunity to receive and transmit information in real time from the corresponding gaming equipment through Internet or other channels of communication, collection, processing, accumulation and registration of information about bets, paid winnings (prizes), payments and other operations related to the organization and conduct of gambling. It will also allow identification of persons who are prohibited from visiting gambling establishments and playing online due to gambling addiction (ludomania).

In their open letter to representatives of various branches of government regarding the situation in the gambling sector, the legal gambling organizers note that the reform of this sector is not finished, because no changes to the tax legislation have been adopted and there are still some gaps in regulatory activity. That is why representatives of the gambling industry insist that it is required to do the following:

– Adopt draft Law of Ukraine "On Introducing Amendments to the Tax Code of Ukraine and Other Laws of Ukraine on Taxation of Income from Activities Related to the Organization and Conduct of Gambling and Lotteries" (No. 2713-д dated 19 June 2020);

– Adopt draft Resolution of the Cabinet of Ministers of Ukraine "On approval of the Procedure for the Functioning of the State Online Monitoring System".

Accordingly, ensure the creation and commissioning of the SOMS simultaneously with the entry into force of the law on changes to fiscal legislation.

This will enable completion of the reform of the legalization of the gambling business in Ukraine, create conditions for the investment of large global companies in it, and significantly increase tax revenues to the state budget from both gambling and related industries.


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