As of July 1, 2021, online poker is fully legal in Germany as the Glücksspielneuregulierungsstaatsvertrag (GlüNeuRStV-E) has come into effect. Prior to that, it was somewhat of a grey area and solely the state of Schleswig-Holstein had granted licenses to operate within its borders. This doesn’t matter anymore as the same rules now apply to all sixteen states.
The new online gambling regulation has severe consequences and all international operators that wish to remain in the German market have responded accordingly. Almost all sites have removed the high-stakes cash game action and limited their SNG offerings. However, some approaches are different as all operators aim to deal with the situation and retain customers with residency in Germany.
Broad restrictions have already been in place ever since the toleration period started in October 2020. Some operators such as bookmakers on the iPoker network and French online poker giant Winamax left the market back then. 888Poker, Unibet and Run It Once Poker all pulled out temporarily in order to comply with the suggested changes.
As far as German poker players on the GGPoker Network (GGPN) were concerned, leading Asian poker site Natural8 was no longer an option. All Germans were moved to GGPoker and cannot take advantage of the exclusive promotions unless they relocate to another country. Now that the law has indeed come into effect, this step has become even more of a concern.
New Regulations and Turnover Tax for Poker in Germany
Most restrictions of the tolerance period have been carried over into the new online gambling law, which essentially treats poker the same way as any other casino game.
- four table cap in total no matter what game type
- 1,000 Euro monthly deposit limit
- panic button and hourly reality check
- account verification required
On top of that, German politicians have also agreed on a turnover tax of 5.3% despite the warnings of several industry leaders. This percentage is far higher than the 2% taken as tax in the regulated French online poker market, for example. It also gives land-based national casinos a large advantage over international competitors.
According to the new gambling law, the 5.3% tax refers to the buy-in level for each competition. Essentially, no matter if Multi-Table Tournaments, Sit and Go or Cash Games, they are all concerned by it. As the text suggests, it applies to the entry stage when you sit down at a virtual poker table and before you receive the first cards.
The text doesn’t specify how exactly the operators are supposed to collect the tax. Essentially, they have to pay 5.3 big blinds for each 100 big blinds one of the players based in Germany brings to the table in cash games. For MTT and SNG this is more straight forward as the poker sites already collect a service fee to run the games.
Most operators have decided to keep the full MTT selection available and many of them use the normal entry fee. They cover the expenses for the tax and lower their own profit margin from a game type that doesn’t earn them a lot of money anyways.
High Stakes Poker Removed for Poker Players in Germany
As far as SNG are concerned, many formats have been removed across all operators. They have also removed the higher stakes as well. On PokerStars, for example, the highest lottery-style Spin & Go available to German players from now on costs $50 to enter. Rake was increased to combat the additional expenses and players have to complete a minimum number of hands before they can leave a cash game table. However, German customers still have access to all MTT’s including the weekly flagship tournaments and well-known festivals.
888poker significantly reduced the SNG and only offers lower stakes from now on. Unibet, who were the first to publish their anticipated measures if the turnover tax will be implemented, has ceased to offer cash games and regular SNG. Only the jackpot HexaPro format and MTT remain available.
GGPoker Takes Different Approach
The initial approach of GGPoker was very similar to all other operators. They removed the high-stakes VIP cash games and the High Rollers brand tournaments have become no longer available. These plans were made public in a player notification by email to German customers while hinting for mid-July to introduce further measures.
On July 7, GGPoker has also revealed how it intends to collect the due sales tax. The operator has decided to shift the collection of the tax levy from the buy-in to the cash-out stage and believes “that this approach will help to spread the tax burden more to the winning players and keep the overall offer sustainable for German players.”
No changes to rake and tournament fees are planned but GGPoker will levy the tax duty at the end of all cash games, sit and gos, and Multi-Table tournaments. Instead of charging prior to the start of the session, the 5.3% are due on whatever amount a player based in Germany finishes with. The only scenario in which no sales tax will be collected under this approach is a finish outside of the money, if the player ends the cash game session with zero balance at the table or if the tax amount is less than €0.001.
Profitable players will see their margin cut down by 5.3% on a consistent basis but even marginal losers in cash games are set back by the same percentage every time they leave the table. Bonus amounts such as jackpots or cash drops in Rush & Cash that get added to the table balance are concerned by this as well once the player leaves the table.
Many short cash game sessions will cause many tax collections by GGPoker and thus. Those that wish to continue playing under the new circumstances will have to potentially change their strategy. Longer individual sessions would be an answer as they reduce the number of setbacks.
For tournaments and SNG, that isn’t an option as the only measurement for the collection is the success. Where in theory the 5.3% sales tax would only apply on the full buy-in, the amount collected from the winnings can be multiple times of that. The risk of a bigger burden on the player becomes a very likely scenario.
Obviously, the development of the last nine months are not out of the blue. Germany has already tried to regulate online gambling several times and it could have happened sooner if the previous attempts had not violated EU law. Professional poker pros relocated to other countries such as the United Kingdom or Austria, where no strict tax rules on the income re and have been in place.
A relocation would also be required if players based in Germany want to see these restrictions lifted. The proof of residency has to be provided, a day trip over the border to fire up some high-stakes games is not enough. Leaving the country for those that earn a living through poker won’t be much of a hurdle but recreational players with regular jobs might not be able to do so.
Whether or not the restrictions will be modified or lifted in the near future remains to be seen. Until then, higher stakes cash games seem out of reach for all online poker players based in Germany.