March 27, 2015 / 12:32 PM / in 2 years

New Czech gaming law faces delay, tax still to rise

PRAGUE (Reuters) - A new Czech law that will sharply raise taxes on betting companies could be delayed by up to one year until 2017, although the finance ministry is preparing a smaller tax rise until then, an official said on Friday.

Deputy Finance Minister Ondrej Zavodsky said the new law was ready to go to the center-left government’s legislative council but still faced other procedures that will likely mean a delay.

“It is not clear whether everything will be managed by Jan. 1, 2016,” he said, referring to the previous expected launch date of the new legislation.

The ministry said that because of the likely delay to the new law it was preparing an amendment to the existing law to increase the betting sector tax to 25 percent, up from 20 percent of winnings which betting companies currently pay on top of the standard 19 percent corporate tax rate.

Zavodsky told Reuters the ministry was proposing to raise the gambling tax element to up to 35 percent in its new gambling law. This includes taxing fixed odds betting at 25 percent, which has been softened from a previous plan of 30 percent.

The lottery business will see a 30 percent sector tax under the new gambling law while betting machines will be taxed at the highest rate.

The bookmaking market is dominated by five domestic firms, including Prague-listed Fortuna Entertainment Group.

(This version of the story adds quotes, details on law, market)

Reporting by Petra Vodstrcilova; Writing by Jason Hovet; Editing by Elaine Hardcastle

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