The casino tax between profit levying and prohibition tax


The article addresses the historical development and the legal structure of the German casino tax. The operation of casinos was first permitted in the 1930s. For regulatory reasons, a high levying of profits was intended from the start. To this day, the casino tax is up to 80% of the gross gaming revenue in some federal states in Germany. The authors conclude that the legal structure of the casino tax must be reviewed immediately. In the first place, the taxation of casinos has to be aligned to the customary taxation of companies based on the annual yield, which also factors in the high expenses of the casinos. Secondly, numerous tightenings of police- and regulatory laws have caused a massive decrease of revenue for all German casinos since 2008, without a simultaneous revaluation of the legal structure of the casino tax in view of the recent development.

The current taxation system violates the  ban on prohibition taxes enacted by the Federal Constitutional Court; a revision of the laws concerning the casino tax is essential for the German casinos to remain capable of competing.

Published in Zeitschrift für Wett- und Glücksspielrecht (ZfWG) 2012, p. 87