Dutch PokerStars Players Don’t Need to Pay Taxes

The Netherlands isn’t exactly flying towards a legalized iGaming industry, but Dutch poker pros have been given a clearance to keep their winnings from PokerStars.eu.

If you live in the Netherlands and have a high profile in the poker community, then you’d be happy to find out that the Court of Appeals in Den Bosch ruled out in favor of the poker fandom. According to the court, the Belastingdienst (the country’s tax authority) is not entitled to tax the proceedings of poker players. This applies to all sums won while playing on The Star Group’s PokerStars.eu.

This ruling comes after years of contention between players and the Belastingdienst, which initially demanded that all proceeding should be levied with a 29% tax. Nearly 100 players were affected by the lawsuit and they were all represented by lawyer Pepjin le Heux who successfully argued the case in their favor.

According to reports, individual players owed the tax watchdog more than €500,000. Now, this was a difficult case from the start and from the standpoint of Dutch gamers it seemed completely unfounded, because European legislation dictates that poker players are not obliged to pay tax on their earnings from games.

However, the Belastingdienst argued that PokerStars was based in the Isle of Man and hence was no subject to the same rulings. Hence, the watchdog was owed money. However, the court investigation looked into the case only to establish that the money of players was held by Rational Gaming Europe Limited in Malta.

The Belastingdienst will now have to pay back €4,200 in court expenses unless it chooses to appeal the decision in the Dutch Supreme Court. Poker seems to be getting a nice exemption in the Netherlands, although this is already guaranteed by European law.

Last year, the Netherlands attempted to legalize its iGaming industry by pushing ahead with regulatory changes to a rather ossified legal framework. The measures undertaken included a number of special provisions, including “the bad actor” condition whereby companies that had been offering gaming products to Dutch citizens would not be allowed to apply for an official license.

The legislation has been mothballed, although the national gaming regulator is still pressing for penalties for these so-called bad actors. Multiple operators have now being handed penalties of varying amounts. In 2018, the Kansspelauthoriteit (KSA) slapped various online casino brands with a total of €1.7 million.

Among the affected parties were established brands such as Mr. Green, William Hill, Bet-at-Home, Betsson and a few others. The only company so far to take legal action against the measure is Betsson which said it would appeal the ruling and challenge its validity.

Online poker proceedings are not subject to tax according to European Union law, which begs the question what would happen once the United Kingdom officially leaves the Union later this year. The UK has been an important hub for many tournaments and it’s home of some of the most grossing players in the entire industry.