The Finnish Supreme Administrative Court is stepping in to stop the approach taken by the country’s tax administration to taxing online slot games that are operated beyond the European Economic Area (EEA).
Instead of taxing slot play outside the EEA by each spin, the court has said that the tax figure to be paid will be determined by each play session.
Antti Koivula, Chief Compliance Officer at Hippos ATG, commented on the change in a LinkedIn post, stating: “In an unpublished ruling, Finland’s Supreme Administrative Court has partly reined in the Tax Administration’s absurd spin-by-spin approach to taxing online slot games operated outside the EEA.
“The Court held that taxable income must instead be determined for each session of play (pelirupeama). However, losses from one session cannot be offset against profits from another, meaning that a slot player may still lose money overall while owing considerable tax.
“It is worth noting that a separate but related ruling on professional sports betting is expected any day now. That case concerns my own taxation for 2020, when I was still a professional sports bettor. Once the ruling comes out, I will likely revisit the topic in depth. Until then, fingers crossed!”
The Supreme Court passed the change by a 3-2 vote in favour, according to Nordic financial magazine Taloustaito, with Miika Härkönen, Finnish Taxpayers’ Association Tax Lawyer, adding that the minority would have gone even further in the right to deduct.
Härkönen stated: “The most important thing about the decision is that the Supreme Administrative Court did not accept the Tax Administration’s view that each game should be viewed as a completely separate event.”
Yet, ambiguity may still be present when it comes to describing what counts as a single gaming session, or how long between bets would be used to determine when one gaming session ends and another begins.
Härkönen added: “I would personally think that gaming where the games have a clear temporal and functional connection and which may also include breaks is considered a gaming session.
“For example, if you play on a Saturday while going to eat and use the bathroom in between, I would not consider this to constitute multiple gaming sessions. If the taxpayer repeats the same activity on Saturday the following week, it would be two gaming sessions. Gaming sessions hardly need to be completed in one sitting.”
According to Taloustaito, the tax administration must now update its guidelines to reflect the decision made by the Supreme Administrative Court.
Back in June, the National Police Board of Finland, Poliisi, reported that its gambling administration had received 50 licence applications. On 1 July 2027, Finland’s first gambling licences for commercial operators are expected to enter into force.
Before any potential licence holder is considered, a €29,000 processing fee per application must be paid. Additional information, such as a company’s financial situation, may be requested by Poliisi if necessary.
Poliisi also believes it will take approximately six months to process applications, but there is no application submission deadline since the process is continuous.