Jake Pollard
France’s gambling industry is bracing for a challenging period ahead, as the government considers increasing taxes and regulating iGaming amidst political tensions. Prime Minister Michel Barnier is engaged in a crucial budget discussion with adversaries as he attempts to push through essential fiscal measures.
Barnier’s administration is on precarious ground, potentially becoming the shortest in France’s history, as he confronts a no-confidence vote that he is anticipated to lose. This development comes after French lawmakers rejected the 2025 budget proposal he presented earlier this week.
Barnier managed to advance his budget by invoking Article 49.3 of the French Constitution. This maneuver allows him to bypass some parliamentary approval but also permits MPs to propose a censure motion. The far-left party La France Insoumise (LFI) and Marine Le Pen’s far-right Rassemblement National (RN) have been long advocating for such a motion. LFI’s proposal is expected to pass with backing from the RN and most Socialist Party members.
France’s national debt is nearing 6% of GDP, twice the permissible limit for EU member states. Barnier’s budget aims to cut €60 billion via increased corporate and goods taxes and reductions in social services.
iCasino Dilemmas and Tax Increases
In the online gambling sphere, the imminent tax hikes targeting online sportsbooks set for next April are causing concern, as are government discussions about regulating online casinos. The first meeting of key stakeholders occurred yesterday, focusing on addiction issues.
If Barnier’s government collapses, uncertainties will loom over these developments. The increased public attention on online casino regulation complicates maintaining a composed dialogue about this sensitive topic.
Directionless
A governmental fallout would halt the approval of both the new budget and the social security budget, which incorporates the anticipated tax rises affecting companies like Unibet and Winamax. Without a government, 2024’s budget would need a special legal mechanism for adoption.
Another parliamentary election in France isn’t possible before July 2025, following President Macron’s decision to call sudden elections this summer. Should Barnier lose the confidence vote, Macron will need to form a new cabinet.
In a column for Les Échos, Nicolas Béraud, CEO of Betclic and President of AFJEL, the online gambling trade association, described the proposed tax increases in the social security budget as a “bewildering fiscal onslaught” on online gaming.
Structural Impact
Béraud criticized the government for excluding land-based casinos and lottery and retail betting monopolies from the financial burdens imposed on online sports betting and poker operators, which he said would face tax rates exceeding 70% of their gross gaming revenue. He warned this could dismantle the competitive landscape carefully constructed since 2010.
These financial constraints might compel smaller operators to shut down, inadvertently boosting illegal market operators, Béraud added.
“Such a move might even be construed as covert State aid, benefiting La Française des Jeux’s traditional monopoly by enhancing tax disparities with private competitors,” Béraud remarked.
French Political Turmoil
Since President Macron surprisingly announced elections this summer, France’s political scene has been turbulent. Marine Le Pen’s party gained the most parliamentary seats, though the left-wing coalition Nouveau Front Populaire holds the majority of MPs. Both RN and LFI are pressing Macron to resign before his presidential term concludes in 2027.
Appointed on September 5, Barnier addressed the French parliament earlier this week, asserting his inability to further accommodate RN’s demands and emphasizing the need for everyone to fulfill their duties, stating, “Each one of us has to assume their responsibilities, and I’m taking mine.”
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This article is published by SBCNews in collaboration with Gaming&Co.