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Bulgarian Gambling reversal
11/27/09 - Late Thursday saw a stunning reversal of a decision by Bulgarian parliamentarians to limit taxation on gambling to 12 percent in defiance of the prime minister's call for a 15 percent rate.
Prime Minister Boyko Borisov was, as we reported earlier, less than pleased with the 12 percent move and vowed to reverse it....and reverse it he did, pushing MPs in a second reading to vote for the 15 percent rate he needed to balance cuts in alcohol and mortgage taxation areas.
The vote was apparently unanimous, with all 149 MPs present in agreement.
The Novinite news agency reports that BGN 150 million will be raised from the gambling tax in 2010.
The decision did not please everyone; Bulgarian business mogul Vasil Bozhkov slammed the increased tax in a television interview, using some provocative language in describing the politicians involved. Bozhkov is believed in many quarters to be Bulgaria's richest man and was at one time involved in the gambling business.
He told the Pro.bg TV television interviewer: “Under pressure by an unbalanced Finance Minister and Ivan Kostov, an outright lier and the father of corruption in Bulgaria, a genocide against the Bulgarian business is being performed. This is not just with respect to gambling, this is a genocide against the whole business sector in a time of crisis.”
The Finance Minister referred to is Simeon Djankov and Ivan Kostov is the former PM and current co-chair of the rightist Blue Coalition, which supports the GERB government of Borisov.
Bozhkov's thoughts on the issue follow warnings by the Bulgarian Association for Entertainment and Gambling Games that even the former 12 percent rate would cause the collapse of the gambling industry and the loss of 40 000 jobs.
Presenting a different and more supportive view for the hike, MP Iskra Fidosova from the GERB ruling party pointed to Finance Minister Simeon Djankov's study which indicated that Bulgarians are generally negative towards gambling. Only 10 percent think that gambling operators should be favoured, whereas 60 percent are in favour of higher gambling tax, with opinions varying that it should be between 14 - 20 percent.
MP Aliosman Imamov from the ethnic Turkish Movement for Rights and Freedoms said the major problem in the gambling sector was not the size of the tax but weak regulation which would prevent the generation of the projected tax revenues.
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