anchidim zagrean

The practice of gambling in 2021

Recalculation and adjustment of special duties, during the alert period, in the context of European and national regulations

Article from the series “Gambling practice“, by Anchidim Zăgrean, president of ROMBET

The special fees, established and due by the organizers of gambling in Romania, represent, as a whole, taxes on services and must be paid as a result of the delivery of those services, as provided in EU Regulation 549 of 2013, mandatory regulation to apply directly in Romania, according to the Treaty on the Functioning of the European Union (TFEU), art. 288 “The Regulation has general applicability. It shall be binding in its entirety and directly applicable in all Member States”.

At the same time, as established by the special regulation of gambling in Romania, the license and authorization fees are declared and paid in advance, within the terms provided by law, respectively for a full year (ie 12 months and not one year), fixed amount – in the case of license fees and a fixed amount, respectively, as a minimum, in advance, followed by a subsequent monthly adjustment, depending on the cumulative annual income or an annual fee, in a fixed amount and which must be paid in four equal installments (each due installment must be declared and paid in advance), – in the case of authorization fees. The declaration and advance payment of special taxes, due by the organizers of gambling in Romania, should not be seen and understood as representing final and final budget receivables, especially in the context of current restrictions imposed in the course of business, restrictions subsequently occurred maturity of these obligations. On the contrary, the level of these budgetary obligations must be recalculated and adjusted, in order to reflect, each time, the fiscal-economic realities, as well as the restrictive way of carrying out the activity, as a result of these restrictive, additional conditions imposed by the state.

Moreover, the special taxes of gambling in Romania, established by the special regulation, were adopted as a result of the provisions of art.135 of Directive 2006/112, by which the provision of services, in the activity of gambling, are exempt from VAT , but not because these services would correspond to a reason of general interest and this exemption is also not intended to ensure a favorable treatment of these activities. The exemption, which can benefit from gambling, is motivated by purely practical considerations, related to the fact that gambling operations are not suitable for the application of VAT, which is a consumption tax and whose tax base is is the amount received in exchange for the provision of a service, and this system is not easy to apply to gambling, given that consumers pay stakes in exchange for a chance to win, possibly higher.

Practica jocurilor de noroc în 2021

In order to confirm the reasoning, described above, by art. 401 of Directive 2006/112, the EU grants Member States the right to maintain or create a special tax applicable to gambling, interpreting these provisions in the sense that Member States have the possibility to subject each gambling, either a special fee or VAT, as the Advocate General Bot contends in that regard – in Case C-58/09.

So, with this directive, the EU leaves it to the Member States to determine the level and method of taxation of gambling activity, but granting this right does not mean that these excise duties may constitute a deviation from the European taxation system or that Member States could change the nature of these taxes, which must remain taxes on the service provided and, like VAT, indirect taxes, due as a result of the service provided and included in the revenue generated.

In this context, it should be noted that the special regulation of gambling in Romania provides that the license to organize and authorize the operation of gambling allows the economic operator who obtained them to operate throughout Romania, without being it is necessary to obtain authorizations, approvals, additional fees, approvals or licenses from other authorities. Therefore, any unilateral modification or restriction, by the state, of the conditions imposed on the date of granting this right, regarding the development of the activity, by introducing restrictions of any kind (time, space or selection of players) and which the game organizers they could not anticipate them, at the time of obtaining the license or authorization, they must be legal and sufficient reasons for the recalculation and adjustment of the fees due.

Moreover, the state recognizes and confirms the above, by adopting art. IV of GEO 106/2020, establishing that the fees related to gambling exploitation authorizations are not due, by the operators operating traditional gambling, during the alert state, in the conditions in which the activity carried out by them is suspended. In practice so far, but without relying on any legal basis, the competent authorities are trying to restrict this right to adjust the fees due, considering that this adjustment can be applied only if the gambling activity is completely suspended. Quite bizarre, this arbitrary interpretation, given that the legal norm has no firm and clear provision that the adjustment of taxes does not refer to the partial suspension of activity, as is practically the case during this period, respectively, suspension of 70% of the maximum operating area, suspension of the work schedule for certain periods or time intervals, suspension of activity for unvaccinated players, etc.

Practica jocurilor de noroc

It should also be noted here that, in situations where the competent authorities find that the regulation is not clear and comprehensive enough, for the above force majeure situations, instead of interpreting the legal provisions arbitrarily and unarguedly and before taking any action, or to the contrary, it should implement the principles governing any practical situations which could not be clearly and fully covered by the legal rule, such as:
– the principle of fiscal neutrality – which precludes, in particular, the provision of similar services, which are therefore in competition with each other, to be treated differently, as would be the case if gambling organizers were to to pay in full the annual authorization fees, set in a fixed amount, towards the gambling organizers who recalculate the fees according to the realized income (but at which, through the imposed restrictions, the realized income decreases and then also the due fee decreases) or compared to the same type of activity, but which take place in different localities and which, in turn, may have restrictions that differ from each other but would be obliged to pay the same level of taxes;
– the principle of certainty of taxation, by drawing up clear legal rules, which do not lead to arbitrary interpretations, and the terms, method and amounts of payment must be precisely established for each payer, that is to say, they can follow and understand their tax burden, as well as to be able to determine the influence of their financial management decisions on their fiscal burden;
– if the organizers of gambling, affected by the restrictive decisions on the activity carried out, imposed by the state, but without being able to anticipate them and without the possibility to oppose or recalculate and adjust the fees due, it means that they must bear both the loss own income, and moreover, to bear the losses that the state should assume, as a result of the decisions taken. This discriminatory treatment blatantly violates the principle of tax fairness or fiscal equity – a principle that must ensure that the tax burden of each taxpayer is determined on the basis of contributory power, respectively according to the size of his income or property;

As a result of successive measures to extend the state of alert throughout the country, established by government decisions, the organizers of traditional gambling, can implement practical measures to mitigate the economic and social consequences and to protect business.
Given the fact that the budgetary obligations of gambling organizers are established on the basis of a tax return, the only solution for establishing the fiscal situation, based on which the existence of fiscal rights and obligations is established, is the recalculation and adjustment. special taxes, based on the amending declarations (submitted within the legal limitation period), with the sole purpose that they represent, in the end, the correct determination of the taxpayer’s tax situation.
Of course, the tax authority may subsequently examine the facts objectively and is entitled to assess, within the limits of its powers and competences, the relevance of the tax facts by using the means of proof provided by law and to adopt the substantiated solution. on the legal provisions, as well as on complete findings on all the edifying circumstances in question, reported at the moment of taking a decision.

We return, in the following issues of the magazine, with other opinions on the activity of gambling…

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