The unicameral parliament of Ukraine, the Verkhovna Rada, has sent to second reading bill 2713-D that proposes a flat tax of 10% applicable for all gambling activities.

What does the bill say about the taxation of gambling?

Bill 2713-D was originally put forward by Committee Chair Oleg Murasyak who hoped that it would complement the Gambling Act that was signed into law in August 2020.

After much discussion around the taxation of gambling, a flat 10% rate for all forms of gambling has been approved by Ukraine’s Committee on Finance, Tax and Customs Policy in February 2021.

Therefore, and according to this bill, Ukraine-licensed operators will have to pay a 10% tax on gross gambling revenue (GGR) and any operators in this region will be required to pay an 18% general corporate tax rate. Gambling winnings in the eastern country are taxed at eight times the annual minimum wage in the country, or UAH48,000 (£1,223/$1,745).

Long process

Ukraine’s legislature initially voted on whether to pass the bill into law, without the need for a second reading, which would have required 226 votes. After this failed attempt, the Rada successfully voted to instead simply pass the bill to a second reading.

Despite an apparent consensus, this one was criticised by the Scientific and Expert Management Committee of the Rada, which said the taxes should be higher to protect state and local budgets as well as limit consumption by players to avoid negative social impact.

Right timing

This second reading coincides with the country starting to hand out licences to operators hoping to offer gambling products in the market.

In March 2021, Parimatch became the very first operator to obtain an iGaming licence in the country, allowing the brand to offer online casinos, poker, and sports betting to customers in the country. Most recently it’s BetConstruct’s flagship B2C brand VBet that secured approval to operate online casino and poker gambling in Ukraine.

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