The CJEU, more appropriately known as the Court of Justice of the European Union, could make a drastic ruling involving poker and gambling in Denmark. Their verdict is based on a case involving the Royal Scandinavian Casino, which stated that online poker websites operating in Denmark should not be allowed to pay different tax rates to regular casinos.
The Danish government thought long and hard about these taxation policies. They concluded that it was better to place a lower tax on online poker sites, because they wanted them to operate in the country. Getting a license is expensive enough for online sites. The Danish government did not want to scare them away with the same tax rate that applies to established land casinos.
The case brought forward by the Royal Scandinavian Casino argues that by enacting this lower tax bracket, the government of Denmark is creating unfair competition. Having unfair competition is strictly prohibited in EU laws. By having a lower tax threshold, the online betting companies can change their prices and policies relative to land casinos, but still bring in the same types of profits.
A ruling is expected at the end of the month, but many are expecting the court to rule in favor of the casino’s case. There are similar cases currently awaiting verdicts in Portugal and the Netherlands. Both countries are attempting to sort out their laws relative to online poker. They hope to follow the Danish government’s lead by pushing through different tax brackets for online sites.
The CJEU could put an end to such policies throughout the EU if they rule in favor of the Royal Scandinavian Casino. If that happens, it will be very interesting to see how online sites react. If the ruling is only valid in Denmark, the impact will be minimal. If it stretches to countries such as Portugal, Netherlands, Spain, France and Italy, the consequences for online poker could be severe.