France Rolls the Dice on Online Casinos

The French government recently proposed legalizing online casino games. This would be a big shift, since France currently bans these games, unlike most of its European neighbors.

The thinking is this change could kill two birds with one stone. First, it aims to cut into the huge business of illegal online casinos in France. Second, by taxing legal online casinos, the move could raise much-needed money for France’s overloaded budget.

Let’s break down both pieces of this puzzle.

Shady Sites

France’s gambling watchdog estimates that illegal online casinos operating in the country rake in between 748 million and 1.5 billion euros per year. That’s a pretty massive pile of money that the government would love to tax if it could.

The thinking is that by legalizing online casino games, some folks would shift their play to the above-board, regulated sites. This could cut into the illegal ones.

Of course, the head of France’s land-based casinos doesn’t buy this. He argues that legitimizing online casinos won’t make illegal ones go away. After all, those sites often operate out of sketchy tax havens with little oversight.

Still, the government hopes that legalizing online casinos provides a safer alternative for problem gamblers. This could limit risks to public health.

Bringing in the Profits

Then there’s the money piece. France’s budget deficit hit 5.5% of GDP last year, blowing past the EU’s 3% target. And this year isn’t looking any better, with the deficit possibly topping 6%.

That’s got the government desperate to find new revenue sources. By taxing legal online casinos at a whopping 55.6% of their revenue, the move could raise some much-needed cash.

How much exactly? That remains to be seen. But with such high taxes in place, the government clearly expects online casinos to be a cash cow.

Of course, the head of France’s physical casinos hates this idea too. He argues it could lead to a 20-30% drop in business at land-based casinos, forcing many to close up shop.

But for a government strapped for cash, the lure of tax revenue from a new industry may simply be too tempting to pass up.

We’ll see where French legislators land on this debate as the proposal works its way through parliament. But one thing is clear – France’s strict stance against online casinos appears to be cracking.