The tax burden on gaming machines in the Netherlands has forced one of the country’s largest operators into emergency funding measures.
Fair Play Casino, with 22 gaming arcades across the country, had already reduced from a ceiling of 40 venues through the high taxation that the Dutch authorities had imposed on machines.
This week the parent company of Fair Play Casino and Fair Play Online, the Janshen-Hahnraths Group (J-H), gave notice that it was seeking debt settlement through the Wet Homologatie Onderhands Akkoord (WHOA), for its business in 2024. Janshen-Hahnraths' business this year is not affected.
The WHOA system is similar to the US Chapter Eleven process, in that it protects companies from bankruptcy through high debts at a time when their current business is actually profitable.
J-H has said that a major financial reorganisation undertaken last year had created an environment in which its operations are now healthy.
The problems are historic – recovering from the pandemic – and the current rates of tax imposed in the Netherlands on gambling. In 2020 when the pandemic began, the company posted a loss of €9m, partially offset by government emergency funding of €6.9m, some of which had to be subsequently rapaid.
But the country’s gambling tax rose from 29.5 percent to 30.5 percent. It is noted in research by KPMG last year that a one per cent rise in tax would result in 20 per cent greater losses for operators.
J-H’s restructuring last year saw redundancies among staff and the closure or selling off of some of its venues.
The Dutch Government has given notice of its intention to gradually increase gambling tax up to 37.8 percent by January of next year.
