The gaming market in Norway is regulated and a gaming tax imposed

The government requested in 2015 that an investigation would be added regarding the new regulation of the Norwegian gaming market could be developed through a licensing system, instead of the monopoly that the current legislation is based.

The background to the gaming commission's mission is to develop the gaming market in Norway, because of the Internet, led to the game play takes place across national boundaries of gaming companies that are not subject to state control. Foreign gaming companies that do not have a license to organize gambling in Norway has a market share of 23 percent, and the proportion is growing by 1-2 percent a year.

Now the commission's report, handed over and the investigation is proposing major changes to the gaming market, including the proposal that the state monopoly is broken and that the gaming market is divided into three parts as follows:

- Slot machines and physical casinos

- Traditional lotteries, such as subscription lotteries and scratch cards, as well as

- Online games in such sports, bingo and casino

Online gambling is the part of the gaming market where examination will be put out to tender, which means that the market is opened to players other than state-owned companies. For companies that want to operate in Norway in the competitive area will be subject to the company applying for a license. The requirement of a license does not include only companies that provide games to the players, but also the company that develops, designs or customize games or otherwise, forms part of the provision of games.

The licensing system is proposed to be associated with an application fee and an annual fee.

From a tax perspective, the most interesting news that a tax on the competitive area proposed. The tax is payable by the company that organizes games and the tax rate is proposed to be 18 per cent of gaming items. This means that the tax affects the part closest to the player.

Games items shall be calculated as the difference between the total stakes game company receives and the total payments made by the Company on the games which take place for participants in Norway. The investigator believes that a tax rate of 18 percent will result in 90 percent of companies in the current market situation games in Norway, will join the licensing scheme and hence be subject to Norwegian law.

For players who use the game companies' services will have an incentive to use a company that has a license in Norway suggest gambling investigation an amendment to the Income Tax Act that allows profits at stake from a company that does not have a license in Norway is taxed in the player. The corresponding profit from an online gambling company which has a license will be tax free in the player.The rules are proposed to take effect from January 2019th

Norwegian betting sider

For companies operating in the ”betting side” industry can legislation be welcome, as the Norwegian gambling market is regulated and thus fully accepted to work on. There will also be a better predictability with regard to the rules of the companies in the betting sider industry have to relate to.

An outdated system of monopoly are also changed out. The regulation may also increase opportunities to market themselves on the Norwegian market. This means that today's foreign regulated gaming company with Norwegian license including the opportunity to legally sponsor sporting events and sports brands. It may be mentioned that gambling tax has already been introduced in other countries, and the proposed system is similar to that introduced in the UK (tax of 15 per cent) and Denmark (tax of 20 percent).

We consider the proposed Norwegian gaming tax of 18 percent will be at a level that is acceptable for gaming companies affected by the tax directly or indirectly.PwC will of course monitor the situation together with our customers in the gaming industry.

Questions that arise include whether all gaming companies will be able to apply for a license on the same terms and how gaming customers will react to the regulation. An important issue for the players in the industry is that a decision on the introduction of the new rules well in advance of January 1, 2019 so that companies have time to apply for a license in time.