Who regulates the gambling market in Poland and who takes care of the legal consequences? The case of Poland is not as simple as it seems. As there is no separate body dealing with gambling issues in our country, issues related to this topic are handled by:
- the prosecutor’s office,
- National tax administration
- customs services
In Poland, gambling operators are subject to the Money Laundering Act, so online casinos are required to establish the identity of players (KYC policy) and provide this information to the special request from the departments concerned. Additionally, in most cases, companies applying for gaming licenses are required to demonstrate compliance with anti-money laundering laws as part of the licensing process.
Since July 1, 2017, internet service providers have been required to block both the websites and the payments of internet service providers found to be illegal by the Minister of Finance. Once the URLs of these service providers have been entered into an Internet registry called the Prohibited Domains Registry, ISPs are required to redirect visitors wishing to visit the site in question to the government registry website. Failure to comply with this provision may result in a fine of up to PLN 500,000. ISPs are required to terminate contracts with entities that promote or publish blocked URLs.
In the article you will learn, among other things:
Land-based gambling restrictions in Poland
Polish gambling law specifies that games of chance can only be played in specific and specially designated places. Their location is described in detail by the issued license – a complete list of land-based casinos and a list of numerous offshore casinos can be found on professionally maintained websites devoted to gambling, for example Kasyno pl. When it comes to land-based casinos, the Polish Sejm has imposed strict restrictions on their number in a given city and province, resulting in low competitiveness of the gambling industry in 2022.
|land-based casinos||These are places where you can bet on roulette, craps, card games like baccarat and blackjack. popular slot machines can also be found here.||The number of ground gambling houses is low.
● In a city, up to 250,000 Only one casino can operate from residents.
● In large cities with more than 250,000 inhabitants. the maximum number of branches increases by 1 in 250 thousand. citizens.
● In a voivodship, there cannot be more than one casino for 650,000 inhabitants. residents.
|bingo for money||This type of game can only be played for real money in the appropriate showrooms. This game is not very popular in Poland and in practice the number of bingo parlors in operation is close to zero.||● The number of bingo shops must not exceed one per 100,000 inhabitants.
● A bingo hall can be located for 300,000 people in a given province.
|sports betting||–||When it comes to betting, there are no limits to their numbers on the Vistula.|
|ATMs||This type of activity is possible in land-based casinos and in specially designated arcades. They are managed by Totalizator Sportowy.||● there can be a maximum of one machine per 1000 inhabitants of a given district.
● in total, more than 800 such showrooms were operating in Poland at the end of 2021 and their number is constantly growing.
Sports betting and fan promotion lotteries require a license to run them. Operators must have a company registered on the Vistula, and the Polish tax authorities reserve access to all remote accounting 24 hours a day. There are more than a dozen licensed bookmaker houses in Poland and, in general , the market is partially open and there are competition rules. The situation is different in the case of online casinos.
They are organized by Totalizator Sportowy. It owns, at the request of the Minister of Finance, the only legal online casino for real money, namely Total Casino. In fact, this closed the way for large international companies offering online gambling services to enter the market. Offshore casinos are therefore prohibited in Poland and players who create accounts with foreign operators are exposed to heavy criminal penalties.
Due to the fact that it is forbidden in Poland to gamble for money in foreign gambling houses, fans of this type of entertainment on the Internet are doomed to use sports betting and various types of lotteries, which can work thanks to various permissions. So, if we decide to play without a license (which is understood as using the offshore casino website while remaining on the territory of the Republic of Poland), this is treated as a tax offence. Theoretically, the participants themselves are prosecuted, because bringing to justice operators registered on islands off the coast of Venezuela or in Gibraltar is very difficult. In practice, no heavy repression is applied to the players themselves and the number of fines is negligible compared to the size of the whole underground economy in Poland.
Prohibited Domains Registry
Since July 1, 2017, a new measure has been applied against unlicensed operators (mainly offshore). The government is setting up a blacklist of websites used to offer unlicensed gambling.
To date, well over 25,000 addresses of online services are expected to be blocked by providers in Poland. Their number has more than doubled compared to the same period a year ago. The restrictions also apply to payment operators in Poland, who are also required to suspend payment transactions for offshore casinos and bookmakers operating without a license. How does it work in practice? Looking at the growing list of offshore casinos on portals, the interest in foreign games is increasing month by month. Players use cryptocurrencies and virtual wallets, through which they can withdraw winnings and deposit money safely and completely anonymously.
Public opinion and part of the industry do not leave a dry thread on the applicable regulations, even if opinions also differ:
- these measures are often criticized as being too restrictive – Polish legislation in this area is considered the strictest in the entire European Union,
- some of the licensed bookmaker operators rent them because they need to help increase their turnover and reduce the underground economy,
- restrictive regulations, according to market analysts, contribute to less competition, especially in the case of online casinos,
- The size of the gray area of electronic gambling in Poland cannot be accurately estimated, so the victory over illegal gambling, proclaimed in a triumphant tone, and the ministerial declarations concerning the shrinking of the underground economy, are not supported by any evidence.
Taxation of gambling winnings in Poland
Gambling tax in Poland is not related to income tax. This obligation was imposed on operators of casinos and bookmakers, with the exception of income from the organization of lotteries and special bingo games, which were not taxed, since the profits derived from them are often a source of funding for charities. VAT does not apply to games of chance.
Unfortunately, the aforementioned tax also applies to winnings from playing poker – here the organizer of a given tournament is obliged to pay a 25% tax on the winnings. A player who has won in an online casino and in a land-based casino must pay a flat tax of 10% on the total amount exceeding PLN 2,280.
Summary – future outlook
The instability of financial markets and households following the war in Ukraine did not dampen the growth of the book manufacturing and gambling sectors. Examples? The magnate of our market, the company STS, has announced an increase in the total amount of bets placed in 2021 compared to the same period a year earlier by 25%!
From a legal standpoint, there are no immediate changes to gambling law on the horizon. It is possible that in 2022 we will have to modify the regulations in this area. The expected revolution in the market may not happen, however, as further tightening is expected. The draft law provides penalties for providing funds, premises or objects for the organization of games of chance or for obstructing the official activities of persons authorized to control devices and conduct games of chance. We expect the Sejm to deal with the project after the summer holidays in 2022.
Additionally, gaming companies are actively lobbying to change the tax base for gambling in Poland. In response to a parliamentary question, the Minister of Finance admitted that he was studying the possibility of changing the tax base from the current total amount of the rates paid to the difference between the rates paid and the earnings paid. Such a possible change would be revolutionary, as the tax base would be the operator’s gross income from gaming, not turnover.
For now, however, there are no statements as to the amount of the tax rate. The analyzes carried out by the Ministry of Finance have not yet led to specific legislative changes, but the taxation of gambling in Poland remains a hot topic.
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