Decline in tax revenues from gambling in 2023
In 2023, tax revenues from gambling in Germany recorded a decline for the first time in years. According to the Federal Statistical Office, revenues fell by 3,6% to a total of 2,48 billion euros. Despite this decline, revenues are still 51,5% above the 2013 level, when 1,64 billion euros were generated. 2022 remains the record year with 2,57 billion euros, while 2023 takes second place.
The lottery tax represented a stabilizing factor in 2023. At 1,77 billion euros, revenues in this area rose by 5,8% compared to the previous year and accounted for around 71% of total gambling tax revenues. In a ten-year comparison, this represents an increase of 22,3%.
The situation was different for sports betting. Here, tax revenues fell by 5,2% to 409 million euros, but this still represents an increase of 116,8% compared to 2013. The decline in virtual slot machine tax was particularly significant: revenues fell by 38,5%, from 430 million euros in 2022 to 264 million euros in 2023. Online poker also recorded a decline, with a decline of 7,5% to 30 million euros. Both segments have only been taxed since mid-2021 as part of the State Treaty on Gambling.
Causes of the tax decline in 2023
The decline in tax revenue can be attributed to several factors. One of the main causes is competition from illegal gambling offers. According to an analysis by the North Rhine-Westphalia State Office of Criminal Investigation, illegal slot machines generate similar revenues to their legal counterparts. Strict legal regulations for legal providers could lead to players switching to unregulated, illegal offers.
Another aspect is the increased awareness of the risks of gambling. Initiatives such as the online self-help program "Neustart" from the University Medical Center Hamburg-Eppendorf help those affected to control their gambling behavior. Such programs may contribute to fewer people participating in gambling and thus lower revenues.
Regional differences
The revenues from lottery tax that accrue to the federal states are distributed differently regionally. In 2023, North Rhine-Westphalia had the largest share with 22% (535 million euros), followed by Bavaria with 14% (350 million euros) and Baden-Württemberg with 12% (300 million euros). These differences reflect the population density and the popularity of gambling in the respective regions.
Despite the decline, the level of tax revenue from gambling in Germany remains high. However, the significant drop in virtual slot machine tax in particular shows that structural changes are underway in the gambling market. It will be exciting to see how the market shares between legal and illegal providers develop and what measures are taken to curb the illegal gambling market.
At the same time, digitalization is likely to continue to play a central role. The regulation of online gambling and the protection of players remain crucial issues in order to both secure revenue and promote responsible gambling.