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Online gambling

Government to tax foreign gambling companies

Published torsdag 26 april 2012 kl 16.22
Seven of ten online poker players in Sweden are active on foreign websites. File photo: Scanpix

Online poker is big business in Sweden - despite the state gambling monopoly. Seven out of ten online players already spend their time on websites run by foreign companies. These companies now say they are willing to pay higher taxes in exchange for licenses to operate in Sweden.

"I've played poker professionally for four years, so I recognize many patterns. The good players switch up their game, while others are easier to track," says Shahin Baharan, who has been making a living playing poker for four years.

Baharan refers to poker at his work. Not long ago, he played during regular working hours at an office he rented with fellow poker players.

"We used to play poker there, like in an office. People have started realizing that it's a good way of handling, because poker isn't just a card game – it's a business and a job," he says.

Sweden's gambling monopoly means that Svenska spel, a state-owned gaming operator with a 50 percent market share, is the only provider of online poker in Sweden.

But up to seven of ten online players are active on websites owned by foreign companies. These companies, which are often based elsewhere in the EU, are not taxed for their profits.

But now, that may change.

The Christian Democrats, one of the four parties in the ruling center-right government alliance, recently proposed implementing a license system for these companies.

According to the proposal, which is supported by the rest of the government coalition parties, the Social Democrats and the Sweden Democrats, the government would levy a twenty-percent tax on the companies' profits.

A similar system was introduced in Denmark at the start of 2012.

One might expect companies to be skeptical about going from no tax at all to one fifth of their profits.

But Inger Holmström at PAF, the Finnish gambling monopoly that operates on the internet in Sweden, says that her company would be eager to apply for a license to enter the Swedish market.

"We think it's important for us to be in this market under a license, so we know what is allowed and not. Then, of course, it depends on how this license is shaped," she says.

Aside from the tax on profits, the Christian Democrats have advocated a licensing system that also place restrictions on advertising for gambling companies.

Limiting advertising would align the system with the ideas that formed the Swedish gambling monopoly – to limit gambling, and for the state to take social responsibility for those with gambling problems.

The professional poker player Shahin Baharan knows the darker side of gambling. At 18 he won $10 000, only to lose it all the following day.

"I just went lay down on my bed and slept. I've had periods where I've literally cried over my losses," he says.

The question remains how gambling companies will be required to take responsibility for customers with gambling problems.

Inger Holmström at the Finnish gambling company PAF says that it is willing to offer help to online customers.

"We believe that our customers are adults, but we need to give them tools so they can limit their gambling in a way that suits them. But there should definitely be regulations on how to protect vulnerable customers."

But Shahin Baharan says it is ultimately a gambler's own responsibility to care of their problems.

"I wouldn't play a person that tells me they have problems with gambling before we start playing."

"Of course I have taken another player's rent money at some point. I know how it feels, because when I started out I got cleaned out for my money. But everybody's an adult and they can take responsibility for themselves. It's not up to me. If they want to play, I will play," he says.

Our journalism is based on credibility and impartiality. Swedish Radio is independent and not affiliated to any political, religious, financial, public or private interests.
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