Czech Republic Gambling — Tax: What is the tax take?

## Application fees The basic licence application fee is CZK 5,000. For each type of gambling, a separate basic licence is needed. Therefore, if for example, an operator wants to offer an odds betting, a technical game, and a live game, it will be required to apply for three separate basic licences and pay the licence application fee three times. ## Ongoing fees There are no ongoing fees for maintaining a licence. ## Any required minimum guarantee The applicant for an Initial licence will have to provide a surety. The Surety can be provided by depositing funds into a special account of the Ministry or by a bank guarantee accepted by the Ministry. The deposit can also be provided by a combination of both methods. The amount of surety will be determined based on the operator’s last known gambling tax. Depending on the amount of such gambling tax, the operator will be included in one of four surety groups. A new applicant for the Initial licence will fall within surety group nr. 1 and will have to provide a surety in the amount of CZK 20,000,000. The Surety groups and Surety amounts are as follows: Surety group 1 (for operators whose last known gambling tax was less than CZK 5,000,000) – Surety amount is CZK 20,000,000; Surety group 2 (for operators whose last known gambling tax was at least CZK 5,000,000 but less than CZK 50,000,000) - Surety amount is CZK 70,000,000; Surety group 3 (for operators whose last known gambling tax was at least CZK 50,000,000 but less than CZK 200,000,000) - Surety amount is CZK 150,000,000; Surety group 4 (for operators whose last known gambling tax was at least CZK 200,000,000) - Surety amount is CZK 300,000,000. A bank guarantee must be governed by Czech law. It can be provided by: 1. a bank based in the Czech Republic; 2. a savings and credit cooperative based in the Czech Republic); 3. a bank based in another EU or EEA Member State, or 4. bank based outside the EU or EEA, if it carries out activities on the territory of an EU or EEA Member State, through its branch. ## Capitalisation requirement The applicant for Initial licence needs to satisfy a financial stability Condition. It is satisfied by an entity whose: (a) own capital, less any outstanding part of the issuance price and any outstanding premiums outside the share capital: 1. is at least CZK 50 000 000; and 2. exceeds the amount of debts, if the result for the regular financial year and the result for previous years is negative, and (b) assets less the Surety, long-term receivables and long-term financial assets are at least CZK 50 000 000. In assessing compliance with the financial stability requirement, the amount in foreign currency stated in the financial statements shall be converted into CZK at the rate announced by the Czech National Bank for the date of preparation of the financial statements. ## TAXES ## Licence Taxes Under Act No. 187/2016 Coll., on Gambling Tax (“Gambling Tax Act”), gambling operators are subject to a special gambling tax. The gambling tax is based on gross gaming revenues (GGR) calculated as the difference between the amount wagered (and not returned to the players) and the winnings paid out to the players. Gambling tax returns have to be filed and the gambling tax paid quarterly no later than 25 days after the last day of each calendar quarter. Rates: Betting, Poker & Bingo – 30% GGR Casino - The gambling tax rate for a technical game is 35%. The gambling tax rate for a live game is 30%. A minimum tax in the amount of CZK 13,400 per each slot machine per calendar quarter applies to land-based technical games even if the actual tax based on 35% of GGR is lower. Lottery – 35%GGR ## Sales Taxes No VAT applies to supply of gambling services. ## Corporate Taxes If a gambling operator is subject to corporate income tax in the Czech Republic, then also such tax must be paid. The corporate income tax rate is 21% of the company’s profits. ## Taxes imposed on customers Based on Act No. 586/1992 Coll., on Income Tax, each player winning in lottery and raffle over CZK 50,000 is subject to 15% income tax. Winnings from each of the other types of gambling are subject to income tax of 15% on an annual basis if the difference between the total winnings and the bets or wagers placed in the relevant year exceed CZK 50,000.