Estonia is set to expedite a review of its online gambling tax cut, prompted by mounting budgetary pressures that have cast doubt on the effectiveness of the reduced tax rate in attracting new players to the market. Prime Minister Kristen Michal remarked, "Certainly this debate will happen. The first clear principle I stated is that culture must not lose out. We have already compensated the missing funds caused by this legislative mistake, and we must find the rest as well so that culture does not suffer."
The Riigikogu has been tasked to reassess the tax rate change, scheduled for August 28, 2026. This measure, which saw the tax on licensed online gambling income lowered from 6% to 4%, was implemented in December 2025, with an initial review not expected until 2028.
The tax reduction was intended to attract new international iGaming operators and expand the tax revenue base. However, a report from the Finance Ministry in June 2026 highlighted that the tax cut had not succeeded in bringing any new online casinos to the market; only two license applications were currently pending.
This review coincides with preparations for Estonia's 2027 budget, as the Finance Ministry projected a decline in gambling tax revenues of €6 million for the year 2026 and a potential drop of €13 million by 2029 if no new investors enter the market. Michal emphasized, "If tax revenue does not increase, there is no point in continuing with further tax reductions."
The tax cut, introduced by the political party Eesti 200, was designed to attract international operators and enhance funding for cultural and sports initiatives. Yet, the absence of notable results has increased pressure to reconsider the current tax reduction policy.
