Another draw for tourists is Croatia’s growing gambling scene, which has gone from strength to strength in the past 5 years. For casino loving Brits, the biggest question is ‘how do gambling laws in Croatia differ to those in the UK?’
Croatian gambling laws
Gambling laws in Croatia have changed a lot in recent years. Until 1991, legislation meant that only those who held a government issued license were allowed to operate, giving the government a monopoly on gambling.
The introduction of the Games of Chance Act in January 2009, allowed for casinos to be built and a wide range of sports and games to be wagered on. However, 20% VAT was also introduced on profits from gambling which made it hard for smaller land-based casino companies to continue trading.
In Croatia, it is legal for players above the age of 18 to gamble in one of the countries 20 registered land-based casinos, online or on state-run lotteries. Lotteries and bingo represent the biggest percentage of the country’s gambling revenues, and unlike in the UK, these games are licensed and operated by the government.
In terms of the law, that’s where the differences between the two countries start and ends. The reason that both countries share many of the same gambling laws is that (at the time of writing) both are member states of the European Union.
When Croatia joined the EU in 2013, it was forced to bring its gambling laws and regulations in line with the rest of the Union. One key change that was implemented was the introduction of €500,000 fees for gambling licences.
This meant that all companies offering their gambling services in Croatia had to pay the fee in order to meet government regulations and operate legally. This decision was not met with glee by the Croatian gambling authority and actually led to riots.
British gambling companies are also obliged to pay a fee to the gambling commission for their licences, although the costs are often double that charged in Croatia. The fees are for all types of operators – including online ones and online gambling is more profitable than ever with UK online casinos booming. If you wish to experience it firsthand for yourself, try out this operator which is considered to be a very popular UK online casino.
Nuances in law do exist between the UK and Croatia in terms of gambling, but there is one clear area of difference that adversely affects tax revenues in Croatia.
In the United Kingdom, all gambling providers are required to base themselves either in Great Britain or one of the country’s crown dependencies. Most operators choose to base themselves in Gibraltar, Malta or the Isle of Man where corporate tax figures are lower than in mainland Britain.
Whilst the tax rate in these dependencies may be lower than if the companies were based in mainland Britain, the law does still ensure that British gambling revenues contribute in terms of tax to the British economy.
In Croatia, there is no such stipulation. Operators from all over the world are free to offer their services to Croatian nationals with no obligation to pay tax in the country. Whilst this may be good for tourists looking to place a bet with their favourite provider on holiday, it is bad news for the Croatian economy and even worse news for homegrown online casino operators.
This is because they are missing out on tax revenue which could be invested in public services such as transport, hospitals and schools.
Before exploring the difference in gambling revenues between the two countries it is important to note that the population of the UK stands at 66 million which is 62 million more than that of Croatia.
Furthermore, as listed on the trading economics, GDP per Capita in the UK is almost three times that of Croatia, which makes direct comparisons between the two somewhat difficult to quantify.
However, last year the total revenues of the gambling industry in the UK totalled 17.5 billion Euros, whereas the Croatian figure stood at 350 million Euros. Those figures may seem lightyears apart, but in reality, they are not.
On average, each Briton spends around 263 Euros a year on gambling, compared to 87.5 Euros by Croatians. If we were to account for Britain’s three times higher GDP per capita, then the relative gambling expenditures per citizen are indeed very similar.
Delving further into the statistics, it becomes clear that Croatians love gambling just as much as Britons, if not slightly more. Croatia’s most recent gambling revenues represented a 16-year high, whereas British revenues were down on the previous year.
Differences in land-based casinos
Croupiers conduct and lead the table-based games in land-based casinos
As mentioned earlier in the article, there are slightly over 20 physical land-based casinos in Croatia. In the UK the figure is just above 100, which is about right for a country 5 times bigger than Croatia.
The only real difference between the two countries in terms of land-based casinos is that the UK is home to 1 ‘Super Casino’ of the size common to Las Vegas. Inside both casinos, in Croatia and the UK, there is no real difference in experience for the customer.
Could the Croatian gambling industry learn from the UK?
For years the British gambling industry has been heralded as the best in the world and used as an example for other counties to follow. Complete with a huge choice of games and engaging graphics, it’s no wonder online casinos are so popular. That no longer seems to be the case as many countries have already adopted the same approach to their own domestic gambling industries, including Croatia.
Pound for pound, gamblers in Croatia spend a similar amount to their British counterparts and evidence even points to higher growth in Croatia than in the UK.
Furthermore, legislation and regulations in both countries are incredibly similar, meaning that both operate with a high level of scrutiny towards unscrupulous and criminal elements within their respective gambling scenes.
An area that the Croatian government could learn from the British would be licences and taxation. In order to fully reap the benefits of a booming gambling economy, Croatia must adopt the British approach of requiring companies to base themselves in Croatia and pay domestic, rather than overseas taxes.
Other than that, it would be rather prudent of British gambling experts to study the scene in Croatia in order to discover what is making the industry so successful on this small slither of the Adriatic.