Casino Wins and Taxes Policies around the World
As far as online casino gaming is concerned, countries worldwide can be categorized into three. The first category is where all forms of online gambling activities, such as the Verde casino bonus, are allowed.
In this category, online gambling is not only legal but also regulated. This category is further divided into two: one where players can pay taxes and another where no taxes are charged on casino wins.
The second category is where countries openly ban any form of online gambling. Anyone who breaks the law is subject to punitive legal ramifications.
The last category consists of countries where any form of online gambling falls into the legal gray area. What this means is that online gambling is neither explicitly banned nor is it legal.
Most countries fall under this category, as many still use the old colonial or outdated gambling laws. They will use, for example, internet laws to guide players on whether or not to visit online casinos. Because there are no clear-cut laws governing online gambling, scams are quite prevalent.
Countries Where Casino Wins Are Not Taxed
If we start in Europe, none of the Baltic states – Latvia, Estonia, and Lithuania – require you to pay taxes on your casino wins. As a player, you are protected by law, and only the casino must pay the taxes on your behalf.
This is the same situation in Scandinavian countries, as well as Finland. The same story goes for oceanic countries. Australia is considered to be one of the countries where people spend heavily on gambling. And even though they do that, they are not required to pay taxes on their winnings.
And, of course, the same strategy is used in the United Kingdom. As one of the heavily regulated online gambling industries, players are not required to pay any taxes on their winnings. The UK Gambling Commission categorizes online gambling as a form of entertainment. As such, players are not supposed to pay taxes on their winnings.
In North America, Canadians are not taxed. Countries in Africa, South America, Asia, and the Caribbean are all tax-free havens for online gamblers. Significant countries where people gamble a lot and are not taxed include the following:
- Czech Republic
- South Africa
Countries Where You Pay Taxes on Casino Wins
On 14 May 2018, the United States Supreme Court paved the way for individual states to regulate their online forms of gambling. This was after repealing the PASPA Act of 1992, which made any form of online gambling illegal. With the PASPA Act of 1992 gone, half of the states in the US have already legalized online gambling.
But long before the repealing of the PASPA Act of 1992, gamblers are or were required to pay taxes. This is because taxes on online casino wins are governed by federal tax laws. Players are not always required to pay taxes every time they win, but rather on special cases.
You must report winnings to the Internal Revenue Service (IRS) in the event you win:
- More than $600 on odds of 300 or more;
- $1,200 or more playing online slots or bingo;
- $1,500 while playing keno;
- $5,000 or more playing poker.
It gets interesting. Foreigners playing casino games in Las Vegas are not subject to paying any taxes, regardless of the amount they win. But this has to be a nonbusiness form of entertainment. If you are a professional player visiting Las Vegas, you may have to pay taxes following a special rule.
In Mexico, bettors are required by law to pay a 1% federal tax. There is also a state tax on gambling winnings, ranging from 4 to 6%.
In Europe, not all countries have a tax-free policy on their casino wins. For example, in Germany, players are required to pay a 5% fee on any amount wagered. This applies to both online casino and sports betting bets. They must also pay an additional 5% tax on their wins.
If you are a French national, any winnings over €1,500 are subject to a 12% tax. The good news is that the player is not subject to paying the tax. Instead, the online gambling platform has to submit the tax. This rule applies to bettors who play locally. If you choose to wager using an offshore online gambling platform, players are required to pay their taxes. This explains why many players prefer local bookmakers and why few foreign-based betting sites are keen to offer their services to French bettors.