Taxation on Sports Betting in Germany
What is the Racing Bets and Lotteries Act (Rennwett- und Lotteriegesetz)?
This act was passed by the German legislator and came into force on 01.07.2012. This act subjects all sports bets (offline and online) to taxation at a rate of 5% of the stake wagered, which must be paid to the financial authorities. The Racing Bets and Lotteries Act does not only affect bwin but the entire sports betting market in Germany.
How does it affect the bwin customers?
For all bets lost, bwin will cover the entire taxation amount. Only in the case of won bets you will take a share in this tax burden (quota discount). The quota discount is calculated on the basis the of gross winnings (stake x odds x 5%).
How will this be reflected on the bet slip?
Your bet slip will, in addition to the odds and stake, also show:
- Possible winnings (gross)
- 5% quota discount (only applicable in the case of won bets)
- Possible winnings (net)
How does the Racing Bets and Lotteries Act work?
Here’s an example. Imagine you place a EUR 10.00 sports bet at odds of 2.00.
Should you win your bet, your winnings (gross) would be EUR 20.00. In this case, your contribution to the tax burden will be EUR 1.00 (EUR 10.00 stake x 2.00 odds x 5%). Your winnings (net) would therefore be EUR 19.00. Should you lose your bet, bwin will cover the entire tax burden.
Please note that, also as a result of the taxation on sports betting, it is not possible to place bets with odds of less than 1.06.
The Racing Bets and Lotteries Act only affects sports bets.
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