Despite netting H1 growth, French stakeholders fear “monumental impact” of rumoured tax increases sought by new Prime Minster Michel Barnier
France’s gambling GGR was up 3.8% to €5.5bn in the first half of 2024 compared with the same period last year, with FDJ recording a rise of 5.5% to €3.5bn in GGR and online sports betting operators’ GGR rising 10.5% to €1.3bn.
But with France’s sectoral growth driven by those two stakeholders and the country’s other verticals reporting mixed results, recent industry news was dominated by a possible tax raid on French gambling operators across all channels and verticals.
The new measures will be discussed during the forthcoming parliamentary debates on the country’s budget and have led to industry stakeholders bemoaning the fact that they are already taxed at around 55% of their GGR will be subject to a tax burden that could exceed 60% of GGR.
Online sportsbooks would take the heaviest hit and pay close to €150m in extra taxes, while FDJ’s lottery revenues would have to find an extra €138m to pay the French taxman as part of the new measures. Horse racing operator PMU could also be on the hook for “between €60m and €100m” in extra taxes, one industry contact told Les Echos.
An unnamed source from AFJEL, the trade body for online operators in France, told Les Echos that it was extremely worried. “The tax rise that is being envisaged is monumental” and its “effects would be devastating” because it would basically “condemn the vast majority of legal operators to permanent closure”. The source added that such an outcome would impact the sports and equestrian ecosystems that are financed by the legal market and lead to even more growth for the illegal operators targeting the market.
Returning to the sector’s figures, FDJ lottery activity (draw and scratch games) increased 4% to €2.9n with group GGR up 14% to €611m, driven by new acquisitions ZETurf and Premier Lotteries Ireland (PLI). Online sports betting generated 871€m in GGR, a 16% rise on H1 2023 on the back of a 24% rise in stakes to €5.2bn.
ANJ said the vertical’s strong performance was driven by the Euro football tournament and strong showings by French clubs in the Champions and Europa Leagues. Online bookmakers also active player numbers reached a new record of 3.7 million during the period.
Horse racing tote betting recorded a 6% rise in stakes to €787m but GGR was down 2% to €174m, the first GGR drop for the vertical since H1 2022. Online poker GGR was up 2% to €257m as active player numbers increased 11% to 1.5 million.