Record start to 2019
Online gambling in Portugal had its best-ever single-quarter performance in the first quarter of 2019. A major reason is that players had more options.
The Servi?o Regula??o e Inspe??o de Jogos do Turismo de Portugal (SRIJ), the regulatory body, released figures showing profits of €47.3m ($53.4m;?￡42.4m) for regulated gambling in the first quarter of 2019, which ended on March 31.
This is a 43.8% increase from the same period in 2018 and a €4.3m ($4.9m;?￡3.9m) improvement over the final quarter figures in 2018. This was the best quarter for the sector since regulation began in May 2016.
Ten companies have licenses to operate in the Portuguese market, three more than at the end of the first quarter in 2018. These ten operators have 16 licenses among them. Nine of the licenses are for online poker and casino platforms and the other seven are for sports betting.
Breaking down the numbers
The profit for sports betting during the quarter was €24.8m ($28.0m; ￡22.3m), an increase of 42.5% over the same period in 2018. The total sports betting handle was up by 30%, reaching €131.1m ($148.0m; ￡117.6m). The most popular sport was football, which had 73% of the total handle. Basketball was second with an 11.5% share,?followed by tennis with a 10.1% share.
Online games of chance saw a 46% increase, with profits of €22.6m ($25.5m; ￡20.3m). The turnover for these games was €608.6m ($686.8m; ￡546.1m). Slots made up 63.5% of the intake for games of chance. Roulette was next with a 14.8% share, followed by blackjack with almost 8%.
Revenue from online poker dropped for the third quarter in a row. However,?the poker share is expected to rise because 888 Holdings got a license to operate in the country in January. It will be the only online poker operator besides PokerStars.?
Rising player numbers
With more options to choose from, the number of Portuguese residents who registered in the first quarter rose significantly. The regulator reported about 125,200 new signups in the period, compared to 89,500 the previous year.
Of the total customer base, 318,000 accounts made at least one bet during the quarter. About half of the total player base places only sports bets, with approximately one-third playing only casino games.
More operators will enter the market in the coming months, including GML Interactive, which will operate its online casino and sports betting offerings through its Betano brand.
Taxation situation
The government naturally benefited from the rising revenue figures. Tax revenues reached €14.4m ($16.3m; ￡12.9m), an increase of 31% over 2018. Tax rates for the gambling sector were reviewed recently after operators said that the current rates were too harsh. The current tax rate for online sports betting revenues ranges from 8% to 16% while the rate for online poker and online casino revenues is between 15% and 30%.
The government previously agreed to conduct a review into the regulatory framework two years after the issuance of the first license. Some are calling for a flat tax of 25% on all forms of online gambling. The European Gaming and Betting Association (EGBA) says that the current tax regime in Portugal is “discriminatory.”
The association said in a statement: “EGBA urges the authorities to apply equal taxes across all online gambling products—and based on gross gaming revenue (GGR). This will ensure the regulated Portuguese market becomes more attractive to players—because a sensible taxation level will lead to better priced betting odds—and pull into the regulated market more of the 75% of Portuguese players who are now playing on websites not regulated in Portugal.”
This review will likely take a while because?the review committee was only commissioned in March 2019.