ANJ supports tax increase on gambling companies: small operators in danger
At the beginning of October, the French government announced a probable surtax on games of chance to replenish the Social Security coffers. This announcement had an immediate effect and the stock price of the Française des Jeux fell by almost 10%.
This surtax proposal was submitted to the draft budget, we do not yet know if it will be effective or not but one thing is certain, it has already caused a lot of ink to flow.
The ANJ positions itself for the increase
Isabelle Falque-Pierrotin, the president of the National Gaming Authority (ANJ), does not find it senseless to increase the tax on gaming companies. In an interview with Les Échos, she states that it is not a bad decision to increase the tax by 3.5 percentage points on the gross gaming revenue (GGR). That is to say the difference between what people bet and what they win in the end.
According to her, this could cause major problems for small gaming companies but could also discourage large gaming groups from setting up in France, where the tax on gambling is the highest in Europe. She therefore sees it as a good solution to reduce the supply of games, and at the same time, reduce the problems of gambling addiction.
Afjel warns of major consequences
The French online gaming association (Afjel), for its part, is opposed to this increase, which it finds completely disastrous. It is worried about the consequences of a significant increase in taxes on the sector. In a press release, it states that this could not only destroy businesses, but also cost jobs.
“It would be a disaster for the sector.”
She stresses that the consequences will probably be a decrease in support for sport and horse racing and a growth in the illegal gambling market. These same illegal gambling sites that have already caused more fraud and gambling addiction in recent years.
Unable to cope with this increase
Currently, France has 17 legal operators and many of them are already in difficulty. They are recording losses or barely reaching the break-even point at the end of the month. Afjel stresses that these companies will not be able to cope with the increase in taxes.
“If the tax increases, companies will also have less money to fight gambling addiction. This can only lead to more problems.”