10% Turnover Tax for Gambling and Bookmaking Sectors: New Details

A new proposal suggests implementing a 10% turnover tax for the gambling and bookmaking sectors, in addition to existing taxes. The draft law, titled "On Amending and Supplementing the Tax Code of the Republic of Armenia," is currently being discussed during a four-day session of the National Assembly.

The proposal was presented by Hayk Sarkisyan, a member of the National Assembly from the 'Civil Contract' faction. He noted that in 2010, the turnover in the sector amounted to $35 million, with tax receipts totaling $2.6 million, or 7.2%. From 2010 to 2023, the activity volume increased more than 440 times, reaching $15.8 billion in 2023, with collected taxes amounting to $67 million, or 0.4% of that volume.

Sarkisyan emphasized that the data indicates a decline in the share of taxes within the turnover volume. He then presented legislative changes aimed at regulating the sector over the last five years, which intended to limit and reduce volumes; however, according to him, "these measures have not served their intended purpose effectively."

"Analysis shows that the steps taken are insufficient, and there is a need to increase the tax burden again. It is proposed to establish a 10% turnover tax on this sector," said Sarkisyan, also sharing international examples: 10% in Georgia, 15% in Australia, 5-20% in Germany, 20-22% in Italy, 12% in Poland, 8-16% in Portugal, 8-10% in Spain, and 15% in Hungary.

Sarkisyan also mentioned that some partners from the executive and legislative branches have opposed the draft, arguing that it is inappropriate at this stage. He stated that the project has been discussed with government partners and Prime Minister Nikol Pashinyan, who was in favor and suggested that the amendments come into effect not six months later, but immediately after the approval of the draft.

"It has been proposed to move forward with the logic of increasing the tax. We will make appropriate amendments during the first and second readings, and these companies will pay twice as much in taxes from April 1. State revenues will increase by about 13 billion drams annually," the representative disclosed. He stressed that this draft does not include restrictions for the sector, but similar discussions regarding such projects will soon commence to prevent citizens from squandering their earnings.