Georgia’s New Tax Regime for Online Gambling

Georgia is emerging as a key destination for international online gambling operators, thanks to a new tax-friendly regime. The country’s parliament has approved strategic tax amendments to attract gambling operators targeting overseas customers. With lower taxes and streamlined regulations, Georgia is positioning itself to compete with global gaming hubs like Malta and Curacao. Discover how these changes could reshape the online gambling industry in Georgia and what they mean for operators worldwide.

Georgia Lowers Taxes to Attract Online Gambling Operators Targeting Overseas Markets

The Parliament of Georgia has voted to implement significant tax amendments that will introduce a favorable tax regime for online gambling operators targeting international customers. Scheduled to come into effect on December 1, the changes aim to create a competitive environment for operators looking to expand into Georgia, making it a desirable hub for the growing global gaming industry.

By reducing the tax burden on online gambling entities catering to foreign players, Georgia hopes to position itself as an attractive alternative to established gaming hubs like Malta and Curacao. The reduced tax rates are designed to stimulate foreign investment and encourage operators to establish their operations within the country.

New Tax Rates for Online and Land-Based Gambling

Under the new regulations, land-based slot halls will see their tax rate on Gross Gaming Revenue (GGR) reduced from 15% to 5% when the revenue is generated from foreign players. However, the 15% tax rate will still apply to revenue generated domestically. For slots websites, operators will need to withhold 5% on withdrawals made by domestic players, but the same tax will no longer apply to overseas players. This significant change also extends to online casino sites targeting international customers.

For online sportsbooks, operators will continue to pay a 7% tax on bets placed by domestic customers. However, sportsbooks that primarily target overseas players will be taxed at a reduced rate of 5% on GGR, enhancing the financial appeal for operators looking to focus on the global market.

While these tax benefits provide a substantial incentive, operators are still required to secure a permit from the National Revenue Agency as per the Law on Organizing Lotteries, Games of Chance, and Other Prize Games. This includes obtaining an authorization certificate from Random Systems Georgia, the organization appointed by the Revenue Service to monitor gambling services in the country.

Permit Requirements and Fees

Gambling operators in Georgia need to navigate a detailed permit system. A single online gambling permit allows up to two domains—one targeting the domestic market and the other catering to international players. The annual permit fee for a slots website stands at GEL 1 million (€328,000), while an online casino is required to pay an annual fee of GEL 5 million.

Online sportsbook operators must maintain at least one land-based retail location, with fees for these venues ranging from GEL 30,000 to GEL 300,000 depending on the location, in addition to the GEL 100,000 fee for the online sportsbook. Operators involved in land-based gambling also pay quarterly fees that range from GEL 250,000 to GEL 300,000.

New Restrictions for Domestic Gambling

While Georgia looks to attract international gambling operators, the country has introduced stricter regulations for its domestic market. As of July 1, the Code of Administrative Offences bans all public sector employees and individuals under the age of 25 from participating in gambling, both online and at physical venues. This follows updates made by the Ministry of Finance to the country’s electronic register of citizens prohibited from gambling.

Signed into effect by Prime Minister Irakli Gharibashvili, the new rules also extend to those facing criminal charges in Georgia. The Ministry of Finance has reported that 1,503,989 citizens have been automatically added to the gambling exclusion list, including state employees, under-25s, individuals with criminal records, and those who have opted for self-exclusion from gambling activities.

Gambling operators are required to submit customer databases for cross-referencing against this exclusion list. Fines of up to GEL 30,000 (€10,000) can be levied on operators who breach these regulations.

Georgia’s new tax regime for online gambling operators marks a significant step towards establishing the country as a global gaming hub. By offering favorable tax rates for operators targeting overseas players, Georgia is setting the stage for increased foreign investment and industry growth. However, the country balances this liberalization with stringent regulations for its domestic market, focusing on responsible gambling and protecting vulnerable groups. As the new laws come into effect, Georgia is poised to reshape its position in the global gambling market, offering both opportunity and challenge for operators seeking to expand their international footprint.