Earlier in 2019, the National Assembly of Republic of Srpska adopted the Law on Games of Chance, aiming to improve the organization of games of chance and their introduction into legal frameworks.
The new law – adopted in March 2019 – brought an increase in taxes paid by gamblers to the RS budget and greater control of payments and payoffs in internet betting. Another novelty is the introduction of an international standard in order to protect players.
Additionally, the law strengthens the role of the public company "Lottery of Republic of Srpska". The Ministry of Finance of the Republic of Srpska has abolished the right to organize electronic games by private organizers. According to the new law, such games can only be organized by Lottery of RS, which can then independently select another company for the organization of these games.
The law introduced two new types of electronic games of chance: video-lottery and virtual electronic games, as well as an electronic system through which it supervises the organizer.
Certain changes also apply to the taxation of gains from games of chance. The tax collection depends on the residence of the winner or the seat of the organizer and represents budgetary revenue for the local government unit. The tax on profits will be paid in favor of the budget of the local government unit in which the winner is located. If the winner is a non-resident, the tax should be paid based on the location where the payment was made.
According to the law, the tax base is the amount of the individual payoff of the win minus the amount of the individual payment as a result of which the gain was realized. Tax should be paid at the following rates:
- 10% of the winnings whose value is greater than BAM 1,000 and equal to or less than BAM 10,000;
- 15% of the winnings whose value exceeds BAM 10,000 and is equal to or less than BAM 50,000;
- 20% of the winnings whose value is greater than BAM 50,000 and equal to or less than BAM 100,000; and
- 30% on winnings whose value exceeds BAM 100,000.
The law also introduces the payment of fees for organizing betting games, including online betting. Unlike in the previous version of the law, which obliged organizers to pay only a lump sum of BAM 1,000, the new law envisages a 20%fee on the basis of the total payments received less the total payoffs paid in that month, but not less than BAM 1,000 per betting house.
Monitoring and control is carried out by the Directorate for Games of Chance of RS through inspection supervision, and the electronic control system is performed by the Ministry of Finance. Organizers of games of chance are obliged to provide functional IT equipment that would enable to Ministry to monitor them in real-time so that all payments and payoffs can be controlled.
In order to obtain and maintain a license, according to the new law, it is necessary to pay a one-time fee for organizing the games of chance, in the following amounts:
- For the classic bingo game – the fee is BAM 50,000;
- For betting games of chance – fee is BAM 3,000 per business location;
- For gambling on slot machines – fee is BAM 10,000 per automat club;
- For internet games of chance – fee is BAM 300,000.
It is important to note that the organizers are obliged to provide to the Ministry access to data for at least the last 12 months. In addition, organizers are obliged to adjust their business and status to comply with the legal provisions of this law within six months from the date of its entry into force.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.