Amendments to the Personal Income Tax Act, which introduces the taxation of winnings from games of chance, are not applicable. It is necessary to put these changes out of force and regulate this area in a comprehensive way through the new Law on Games of Chance, which is in the drafting stage in accordance with international and regional practices and experiences", stated the letter of the 11 largest organizers of games of chance sent to the Ministry of finance headed by the minister Novica Vuković.
The amendment to this law, which foresees the taxation of all winnings over 300 euros in all forms of games of chance, was adopted in September, the application of which should start from January 1 of the following year. The law stipulates that the organizers, or their employees, are the ones who calculate the amount of tax (on the difference between payment and payment) and deduct its amount when paying the players.
Even then, through the system of public discussion, the organizers filed a large number of objections to this law and fiscal strategy, stating that it is technically not possible to apply this law in the proposed manner, but most of their objections were rejected. In the new address, they repeat that the application of this tax in the proposed way is not applicable.
"We are addressing you with the aim of pointing out the obvious and very clearly and precisely argued reasons for which it is certain that the Law on Personal Income Tax of September 13, 9, the application of which starts on January 2024, 1, will not be possible to implement in practice, and even if the numerous technical and administrative-legal shortcomings of such a legal solution would be resolved. Its application would have extremely negative effects both on the gaming industry and on budget revenues," the letter stated.
They state that the proposal defined in this way is absolutely inapplicable to games of chance on machines and casinos, that there are no such regulations even in the largest and most famous gaming destinations, as well as in neighboring countries.
"A player plays on a slot machine, he can generate more wins and losses during the game period, and at a certain moment he pays out the remaining part of the money or doesn't pay out at all. Wherein it is impossible to determine the individual payments on the basis of which the winnings were realized, because the player with the realized individual winnings continued to play until the moment when he decided to pay the remaining amount. The same is the case with casinos, because individual winnings and individual payments are not recorded on the gaming tables, nor is it possible to record individual winnings and individual payments on the basis of which the winnings were made in the sense of Article 37s", stated the organizers, stating that such a law will create a negative effect, i.e. an illegal market. games of chance.
They state that even now, 15 days before the application of the law, it is unclear to them how they should apply it, given that there are differences between income and winnings in games of chance and that the law does not precisely define what winnings are.
"It is the legislator's obligation to clearly define the taxed category, the tax base and the tax rate when introducing fiscal measures. In this regard, it is necessary for the legislator to define the category of winnings, that is, previously, what is considered the total stake in games of chance. Also, the timing of the cost/stake and the corresponding category of profit has a very significant effect on the regulation of this new duty", according to the organizers.
In the letter, they stated their experiences in calculating this tax in Croatia, Serbia, BiH and Slovenia, where for these reasons no tax is charged on winnings in slot machines, clubs and casinos, as well as that the taxation of winnings in betting shops is defined in a different way than in Montenegro. It's burning.
Organizers warn that the proposed way of taxing winnings in betting shops is not fair, and that it will cause the transfer of players to the black market and thus the loss of money for both the organizers and the state.
They state that if someone with one euro of payment gets 301 euros, he will pay a tax of 45 euros, regardless of whether he had losses in games of chance that day or month and whether he was in profit overall.
Players will move to foreign sites en masse
Organizers warn that state authorities do not have the ability to restrict access to foreign betting sites where the player will not pay taxes.
"Mass orders will be opened abroad, that is, with foreign organizers where the conditions for betting are more favorable (Federation of Bosnia and Herzegovina and Republika Srpska entities). It is impossible to prevent the blocking of sites for the transfer of funds to foreign organizers of games of chance through the blocking of bins for foreign companies registered for organizing games of chance through domestic banks. With the help of foreign banks, i.e. payment institutions such as Skrill, Neteller, Crypto funds transfer and the use of VPN, all these restrictions are easily overcome. The comparative experiences of countries in the region where this type of tax was introduced showed that in those countries there was a drastic decrease in the number of players, which necessarily resulted in a decrease in expected income", according to the organizers.
They also say that if only 10 percent of players switch to foreign websites, the state will lose more money than it expects to get from this tax.
Bonus video:
