Policy Shift in Romania Raises Stakes for Online Gambling

Policy Shift in Romania Raises Stakes for Online Gambling

Romania's approach to taxing online gambling has become a point of contention, with recent developments prompting responses from key figures within the regulated industry. The Romanian Remote Gambling Operators Association (AOJND) has raised concerns about the government's intention to increase tax obligations further. According to the association, this move may not yield the fiscal gains policymakers expect and could instead lead to unintended shifts in player behavior, with consequences for market regulation and oversight.

The AOJND points to the already substantial fiscal framework within which operators are currently required to operate. With licensed entities reportedly contributing up to 30% of their gross gaming revenue through various tax channels, the industry argues that any increase in this rate would result in operational strain. While governments often turn to tax increases as a straightforward method of expanding public revenue, industry representatives suggest that this strategy may overlook the structural responses such a policy shift can provoke.

Rather than absorbing rising costs internally, operators might adjust their offerings by lowering payouts, reducing promotional budgets, or limiting player engagement tools. These changes, in turn, can alter the dynamics between regulated platforms and their unregulated counterparts, some of which are already active in the Romanian market. The AOJND warns that these shifts are likely to create a pathway for more players to turn to offshore platforms that operate outside national licensing systems.

The warning does not come without evidence. A recent study commissioned by the AOJND found that over 14% of surveyed players in Romania admitted to using unlicensed gambling websites. The reasons varied but centered largely on the absence of restrictions on such platforms. The research revealed that many of these users were drawn to the wider availability of bonuses and the lack of compliance requirements, including income source verification.

This dynamic introduces a regulatory dilemma. While tax increases may be seen as a lever to fund public services, they can simultaneously reduce the appeal of legal operators if not calibrated with market realities. The association suggests that by raising costs for compliant operators and leaving unlicensed ones untouched, the tax policy may unintentionally foster an uneven playing field.

This issue takes on added significance in light of recent fiscal trends. According to Romania's National Office for Gambling (ONJN), state revenue from the gambling sector declined by nearly 17% in 2024, with total tax contributions falling to approximately €689 million. This drop followed a period of tax increases, raising questions about the correlation between tax policy and player behavior. Although the decline cannot be attributed solely to tax changes, the timing raises the possibility that heightened tax pressure may have contributed to shifts in how and where gambling activity occurs.

Beyond revenue, the AOJND has emphasized the implications for regulatory control. Licensed operators are required to implement a range of procedures designed to monitor player activity and prevent excessive or harmful gambling. These include systems for self-exclusion, deposit and wager limits, and income verification protocols. Platforms operating without a license are exempt from these conditions. This disconnect weakens the state's ability to apply consistent standards and track patterns that could indicate harm or fraud.

Odeta Nestor, President of AOJND, stated that without effective containment of the unlicensed sector, players will continue to migrate toward platforms that avoid domestic regulation. She argued that further taxation could accelerate this process by eroding the sustainability of the legal market. This would not only reduce the state's fiscal intake but also hinder efforts to maintain responsible gambling frameworks.

If these trends continue, Romania may face dual challenges: declining tax revenue from its licensed gambling sector and increased activity in segments of the market that fall beyond its reach. In such a scenario, enforcement becomes more complex. Regulatory tools designed for licensed operators cannot be applied to offshore entities, limiting the government's ability to maintain transparency and accountability in the industry.

The AOJND has not taken a position against taxation. Its position is a call for balance. Rather than proposing deregulation, it suggests that the long-term viability of the sector depends on policies that consider both fiscal objectives and behavioral patterns among players. Without such alignment, the formal industry may find itself unable to compete with unlicensed alternatives that bear no regulatory cost.