Gambling industry not a beneficiary of the crisis

For 2019, the DSWV reported records on the German sports betting market, with sales amounting to 9.3 billion euros. With the corona crisis and the global suspension of all sporting events, business came to a standstill and betting sales fell by 90 percent during the first lockdown. How the Corona year 2020 ultimately affected the market is shown in a current breakdown.

According to this, the German sports betting market will record a loss of 20 percent in 2020, unless the pre-crisis months of January and February are taken into accountigt. Overall, sales fell to 7.8 billion euros, around 16 percent below the record value of 2019. According to the association, the figures come from the current tax report from the Federal Ministry of Finance.

The values ​​are based on the taxes paid by the sector: in 2019, a whopping 464 million euros were paid to the state, while in 2020 it was 389 million euros. The DSWV cites not only the cancellation of sports as the main reason for the slump, but also the nationwide closures of several betting shops as a result of the lockdowns.

Against this background, DSWV President Mathias Dahms criticized the fact that many reports portrayed the gaming industry as profiting from the crisis. These are rumored reports, but in reality the opposite is the case: the betting market almost completely collapsed during the first lockdown in spring 2020, when all major leagues had to cease operations. At that point there was 90 percent less sports betting. Sales in May were also down 75 percent. After all, without sport there would be no sports betting, said the chairman.

DSWV President: Betting offices at risk

According to Dahms, sales only recovered in late summer, which was mainly due to the numerous game days that were rescheduled. However, the situation is still precarious for land-based betting offices. Nationwide, 5,000 to 6,000 betting offices are closed or are operating with severe restrictions. This affects around 25,000 employees, most of whom are on short-time work.

According to the DSWV, entrepreneurs and employees are currently all worried about their economic existence. The federal government is still refusing to provide the promised Corona emergency aid for November and December. We need a perspective from politicians as quickly as possible. The question that arises is whether and how safe business operations are possible again with appropriate hygiene measures.

Criticism of the new gambling law

In parallel to the sales results, the DSWV sharply criticized the transitional rules issued in October as well as the new State Treaty on Gambling (GlüStV), which will come into force in July and the legalization of reputable online casinos in Australia provides. Due to strict regulations, a massive migration of customers to the black market can be observed. According to a survey among fellow citizens, the average slump would be around 54 percent.

According to Dahms, it is unrealistic for the licensed online gambling providers to remain competitive under the strict requirements in Australia. The competing companies would simply provide better conditions. Improvements to the specifications are therefore urgently needed. These include, among other things, a ban on table games and live betting, as well as a deposit limit of 1,000 euros per month. Best sports betting casinos can be found on the special page.

Another serious problem is the planned tax model, which currently provides for a rate of 8 percent on stakes on slot machines . The universities of Bochum and Düsseldorf have already warned against the model. A study by the Heinrich Heine University, which was commissioned by the DSWV, came to the conclusion that under these conditions the providers would have to reduce the payout rates in order not to incur losses. A tax on gaming stakes is atypical; gross gaming income would normally be taxed on the regulated markets in Europe.

DSWV fears distortion of competition

The gambling reform actually got off to a good start with the granting of the first German betting licenses. But now, according to Dahms, a distortion of competition of unexpected proportions is emerging. After the 21st license was awarded, the process stalled again. Meanwhile, around 40 more applications are stuck in the queue. Politicians must act quickly.

As the DSWV president further explained, the body responsible for regulation was divided and had not made any further decisions for months. This is an untenable situation in which the licensed providers would ultimately suffer. It is the task of politicians to ensure fair market conditions in order to ensure the primary goal of the new law - channeling into the legal market.

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Author: Alex Morgan