On the latest episode of iGaming Daily, Ted Menmuir, SBC’s Content Director was joined by Jake Pollard to discuss an amendment in France that would have regulated the country’s online casino market.

However, since the episode was recorded, news broke that the French government has withdrawn the budget amendment, citing the need for further consultations to avoid the negative impacts and job losses warned by regional stakeholders.

Jake explained that land-based casinos in France have had long-standing concerns over the online casino market, which is why the sector was not regulated in 2010 alongside sports betting and online poker. 

As a result, he continued by stating it has led to a “major illegal and unregulated online casino market in France over the past 14 years”.

Upon the announcement of the proposed amendment, the land-based casino sector claimed that it would lose 30% of its market share and revenues in the process, which could lead to up to 15,000 jobs being lost.

On the situation in France, Jake said: “The one major difference between France and other European markets is that I don’t know any other European country that has as many land-based casinos within its borders.

“Land-based casinos really are up in arms because, from their point of view, they’re talking about a loss of €500m in tax revenues. The government has forecast in terms of tax revenues from online casino regulation €1bn, so the land-based casinos are saying, that already half of that is gonna be lost by us.

“Plus, if there are job losses you’re talking major social costs. The viability of some of those very small communes is in large part financially supported by the casinos in their communes, in their districts. So all those things come into play.”

In the proposed amendment, operators were set to be faced with a tax rate of 27.8% on gross gaming revenue (GGR). When combined with social security measures, this would have created an effective tax rate of 56% on GGR.

Despite the “substantial” tax rate, Jake predicted that this would not put off operators looking to enter the market.

“Clearly it is not ideal, but high taxes are a fact of life for gambling companies,” he explained.

“We’ve seen in Holland, I think they’re going to raise [tax] in the next couple of years to close to 38%. In the UK, there’s a likelihood that it might happen as well. New York has 51% of GGR tax and operators are still present there. 

“That’s a system they use and their arguments would be that it’s a big market, nearly 70 million residents. It has a strong history in casino and operators will be coming forward, I believe, to get licenses because the market is there and you can still generate profits and margins even off those numbers.”