Russia Alleviates Casino Tax Requirements

In an effort to rekindle the interest from domestic and foreign investors, Russia's government has issued an act that no longer requires players to pay taxes on their gambling wins.

Up until now, all casinos operating in Russia were obligated to withhold a certain sum of money from players who win at least $237 gambling. The country's income tax rate is 13%, while taxes for casino and sports betting wins are supposedly twice that figure (an algorithm determines the exact rate for a specific type of gambling win).

Players in Russia will now be able to collect their winnings in full, but will still need to include the taxes in gaming wins when filing their personal yearly income taxes.

Originally, Russian Finance Ministry was going to back President Vladimir Putin's intent to increase the gambling tax from casinos. However, numerous experts have advised against this direction, claiming this will severely damage the investments in Russia. As analyst Samoil Binder puts it: “Low tax base was one of the dangling carrots for investors-to-be, but the constantly changing legislation, often rather unreasonably, has become a turnoff for foreign investors, along with ever-changing rules.”

Russia has four specially designated gambling zones which they have been trying hard to revive in recent years. Ever since being created in 2014 as an effort to boost the economy in those regions – and as a 180-turn on 2009's decision to close all casinos in Russia – they have done little in the way of reigniting the attractiveness of Russian market to investors.

One of such regions, Primorski Krai, that is near Vladivostok, a city in Russia's far-East corner, was bound to become the country’s take on the Las Vegas Strip or China's Macau, especially after Chinese billionaire, Lawrence Ho, acquired the Tigre de Cristal resort worth $500 million. In December 2017, Ho announced he was selling Tigre de Cristal, after losing more than $1 million in 2017. It is believed that Ho abandoning Russia had a lot to do with the country's government rethinking the taxation laws and will soon be implementing other major changes on their market.