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Sweden Initiates Funding Supervision and Tax Reforms in the Gambling Sector
By Shane Addinall Sep 26, 2023 IndustrySweden's dynamic gambling landscape is witnessing significant changes as the government allocates more funds to regulatory bodies and proposes a gambling tax increase for 2024. Explore the complexities and implications of these moves.Sweden has been actively shaping its gambling industry to find the right equilibrium between a well-regulated market and revenue generation. In being at the forefront of regulating its gambling industry, Sweden seeks to find the balance between generating revenue and fostering a well-regulated market.
This article examines Sweden's most recent proposals to refine its gambling sector further - Increased funding for gambling oversight and a slated gambling tax hike in 2024.
Funding Gambling Oversight
Sweden recognises the importance of supervision, which is why effective oversight in its gambling industry is high on the list. To strengthen this aspect, the government has proposed a notable increase in funding for the Spelinspektionen (Swedish Gambling Authority) and the Finansinspektionen (Swedish Financial Supervisory Authority) starting in 2024.
✓ Budget Allocation: The government has proposed allocating SEK 10.8 million (approximately $970,000) to the Spelinspektionen for its 2024 budget. This funding aims to strengthen the authority's ability to supervise the gambling market effectively.
✓ Future Support: Sweden's commitment to gambling oversight doesn't stop in 2024. The proposed plan includes further financial support with SEK 15.6 million ($1.4 million) for the Spelinspektionen in 2025 and SEK 18.5 million ($1.66 million) in 2026.
Collaboration on Combating Fraud
Sweden acknowledges gambling-related fraud, including illegal offerings and match-fixing, can benefit criminal networks. Additionally, players entangled in the online black market face higher risks of falling victim to fraud or developing problem gambling behaviour. To address these concerns, Sweden strongly emphasises collaboration between the Spelinspektionen and the Finansinspektionen.
✓ Attacking Fraud: The government's action against fraud includes measures to neutralise match-fixing and ban illegal operators from the country, an issue that jeopardises the integrity of professional sports events.
✓ Financial Cooperation: To block payments to and from illegal gambling companies effectively, cooperation between authorities is essential. This financial partnership is set to reinforce the authorities' efforts against fraudulent activities.
✓ Securing Swedish Sports: The Spelinspektionen's enhanced capabilities, supported by increased funding, will protect Swedish sports from illicit activities and match manipulation.
Proposed Gambling Tax Increase
To help stabilise the market, Sweden plans to implement strategies that have proven previously successful. They believe its gambling market has stabilised considerably since its re-regulation in 2019. As a result, the government has outlined plans to increase the tax on gambling Gross Gaming Revenue (GGR) starting from 1 July 2024.
This proposed tax increase will see Sweden's gambling tax rise from 18% to 22%. They expect this move to generate an additional SEK 540 million (approximately £39.4 million) annually.
Channelisation Target
Sweden has expressed concerns about low channelisation, which refers to the percentage of gambling activity occurring within the legal, regulated market. The government hopes that raising the gambling tax will help achieve a channelisation target of 90%, minimising the presence of unlicensed operators.
The proposed tax increase is viewed as striking a balance at the tax base by reinforcing government finances and avoiding undue pressure on gambling companies.
Industry Response
While the government's proposals are rooted in the belief that the gambling market has stabilised, not everyone agrees. The BOS (Swedish Trade Association for Online Gambling) has voiced concerns.
BOS Secretary General Gustaf Hoffstedt expressed disappointment, emphasising that channelisation in the Swedish gambling market is at 77% and declining, far from the government's goal of 90%.
Hoffstedt warned that if the tax increase is approved, channelisation could further decrease, potentially reversing the progress made since the market's re-regulation.
Taking Active Steps to Move Forward
Recent developments indicate that Sweden is not resting on its laurels and is actively taking steps to oversee its regulated gambling market. Sweden's initiatives in the gambling sector highlight its commitment to responsible and well-regulated gambling.
The increased funding for oversight bodies and the proposed gambling tax hike express the government's resolve to strike a balance between regulation, revenue generation, and protecting players. As Sweden moves forward with the implementation of these measures, the Swedish gambling landscape continues to develop and evolve, with potential implications for both the industry and its players.
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