Estonian Lawmakers Promise Swift Fix to Online Gambling Tax Loophole

The Estonian parliament is scrambling to quickly fix an unintended loophole in the country’s gambling tax law. Lawmakers discovered that a recent revision accidentally allowed online casinos to avoid paying taxes in 2026. Estonia’s parliament, the Riigikogu, plans to pass an emergency targeted amendment that fixes the issue by restoring gambling taxes on remote casino games.

The Finance Committee Seeks a Swift Resolution

The fix, introduced by MP Tanel Tein, clarifies that online gambling will receive the same tax treatment as land-based offerings, closing the loophole that emerged when the problematic law took effect on January 1. The issue began with the December legislation, which sought to transform Estonia’s gambling tax framework and increase funding for athletic and artistic initiatives. However, poor wording introduced some issues.

Changes to the Gambling Tax Act established tax calculations that apply only to “games of skill,” without explicitly including online games of chance. As a result, the new system left remote casino games untaxed. The new amendment removes the problematic language and confirms that both chance-based and skill-based games offered remotely are subject to a uniform 5.5% gambling tax.

The updated rate reflects Estonia’s longer-term plan to gradually lower the nation’s gambling tax from 6% to 4% over several years. The Riigikogu’s Finance Committee has set March 1, 2026, as the effective date for the amendment. This timing should avoid disruptions to the IT systems used by operators and the Estonian Tax and Customs Board.

The Omission Could Have Significant Consequences

Finance Committee member Aivar Kokk was among the first to draw attention to the matter. He noted that early committee discussions flagged some inconsistencies, but the scale of the problem only became clear once the law was in force. He warned that the existing text would result in the state losing significant tax revenue, jeopardizing stable funding for public programs.

Committee chair Annely Akkermann also acknowledged the mistake, noting that such an omission was unusual given the number of reviews the bill underwent. She explained that lawmakers, ministry officials, legal experts, and even the president’s office examined the proposed legislation before it became law.

Industry feedback added further urgency to the situation. Akkermann revealed that legal representatives for gambling companies had reached out to the committee, confirming their views that operators never interpreted the law as a deliberate tax exemption. They also agreed that the gap was clearly a drafting error, not a signal of a policy shift.