Georgia’s PM Announces 15% Gambling Business Tax Rise

During a government meeting held last week, Georgia’s Prime Minister, Irakli Gharibashvili, announced his cabinet had submitted a fresh initiative to the parliamentary majority with regard to a series of changes in the way gambling businesses are being taxed.

The Tax Changes, Expected to Bring Extra Money to the Budget

PM Gharibashvili has announced that the current 10% taxation rate applied to gambling businesses should be raised to 15%. At the same time, the PM proposed that the withdrawal figure from gambling businesses, which is currently taxed at 2%, should also be raised to 5%.

The new initiative which was also officially introduced to the public by the PM is expected to attract an additional 400 million GEL ($147 million) to the country’s budget in 2024. At the same time, the PM also mentioned an extra 300 million GEL ($110 million) expected from banks, leading to a grand total of 700 million GEL ($257.8 million) in additional income for the upcoming year. 

The PM, “Not Happy” About the Gambling Industry’s Turnover

PM Gharibashvili also took the opportunity to explain that the domestic gambling sector’s turnover had gone up from 48 billion GEL ($17 billion) to 52 billion GEL ($19 billion) in 2022. The Prime Minister expressed both his “surprise” and “sadness” at the news that the gambling business’ turnover was on the rise, calling it something “I’m really not happy about it.”

The head of government described the respective figures as “catastrophic” while also expressing displeasure at the fact that the number of citizens who have continued to be actively involved in gambling did not drop as expected. 

This comes in the context of the significant changes brought by the government in 2022 in relation to the banning of advertising connected to gambling as well as the prohibition of Georgians under the age of 25 from engaging in gambling.

1.5M Georgians Are Restricted from Gambling

While the latter measure automatically led to 1.5 million citizens of Georgia being restricted from engaging in gambling, added the PM, “we see that too many citizens are involved” even today, two years after Prime Minister Gharibashvili announced the government’s plans to enforce the strictest online casino rules among all countries in the area. 

The announcement was quickly followed by an important set of prohibitions on online gambling, with the previously mentioned gambling ad suspension and a new tax regime on top of the list. 

The new measures resulted from the need to limit gambling-related harm as well as the large amounts of tax money that the country was losing because of gambling operations that were not checked, as explained by the PM.