The Spanish gambling market is a successful combination of gambling traditions and innovation. Both land-based gambling and online gambling are allowed on the territory of the state.
History of gambling in Spain: a brief essay
It is believed that the first gambling houses appeared in Spain in the Middle ages. The center of the development of excitement was the Iberian Peninsula, where there were gambling rooms, where visitors had fun, participating in card games. The development of the industry was interrupted in the first half of the twentieth century, and the revival of the tradition is associated with the accession of Juan Carlos de Bourbon.
The rapid growth in the number of gambling establishments in the country was associated with the development of the economy, which followed the accession of the state to the European Union in 1985. Then gambling became a significant part of the state’s income. It was stated that tax revenues from gambling companies account for 3% of the country’s GDP. At the same time, taxation applies not only to operators, but also to lucky winners who have won more than €2.5 thousand. This is due to the fact that according to the law, the loss of gambling is considered by the state as an unsuccessful investment, and the gain – as an additional income.
The center of land-based gambling in Spain, as in other European countries, is the capital – Madrid. There are six gambling facilities. The largest review casino in the country is considered to be Casino Gran Madrid Torrelodones.
According to experts, the majority, namely 60% of the gambling market falls on gambling establishments, the remaining 40% is distributed between lottery and betting operations.
Land-based gambling is represented by the work of 55 gambling establishments, which are located in 33 cities.
In addition, the country is allowed to place slot machines outside the pin up casino. According to the latest data, the segment brought about 35% of the industry’s profit.
Only two state operators – SELAE and ONCE-have the right to carry out lottery operations.
The land-based segment of the Spanish gambling business is regulated at the level of administrative units-Autonomous communities. At the national level, the gambling act provided for the creation of a new regulator, the National gambling Commission (CNJ). However, the latter has not yet been formed, and since it is not possible to launch the work of the Agency in the short term, before the official establishment of the CNJ, the functions of the country’s gambling regulator are assigned to the Direccion General de Ordenacion del Juego (DGOJ).
DGOJ ensures the functioning of the country’s gambling industry. The Department is responsible for issuing licenses, maintaining registers, the creation of which is provided by law, the settlement of problem situations between players and operators, the fight against illegal gambling operators, the implementation of the basic rules of gambling, as well as checking the compliance of technical and functional aspects of gambling establishments with the requirements put forward by the legislation. In addition, the financial side of the industry is also the responsibility of the regulator, as well as the obligation to combat money laundering.
Gambling operations are subject to a gambling tax, which is levied at the state level by the Spanish state tax Agency (AEAT). In addition, Autonomous communities can set additional tax rates that apply exclusively to gambling operators engaged in the region.
Tax rates are set in the range of 15 to 25% and are charged to GGR gambling companies. The maximum tax rate is applied to online betting operations.
In addition to the tax and fees associated with gambling operations, there is also an administrative fee of 0.075% of GGR.
Read also: gambling Regulation in the EU (Part 1)
Online gambling in Spain is a legal activity that is regulated by the Ministry of Finance. On the territory of the state, slots, roulette, baccarat, bingo, blackjack, poker, fixed-odds betting on horse racing and sports competitions are allowed in the Internet segment.
Licenses for the right to provide online gambling services are issued by the gambling regulator of Spain. There are two types of permissions – General and special.
Each new gambling operator undertakes to obtain a General license, which is valid for 10 years. Special licenses can be granted for a period of one to five years.
It should be noted that the provision of services by international operators on the basis of a license obtained in other jurisdictions is not legal. Such activities are pursued by the gambling regulator.
At the same time, the problem of limiting and banning gambling advertising remains an extremely topical issue for Spain. Despite the initiatives received from the authorities, the law prohibiting marketing activities has not yet been adopted.
Recall that according to DGOJ, the GGR of the Spanish gambling segment is €77 billion, while the growth of the online segment is 22.5%, and the profit is €812 million.