Duisburg increases slot machine tax to 24% for 1 million additional revenue

Last Monday, December 2, the Duisburg City Council decided to raise the slot machine tax to 24 percent. This is expected to generate additional revenue of almost 1 million euros per month, which should boost the monthly gaming income to a whopping 4 million euros. Gambling is clearly on the road to success in the city. Surprisingly, criticism comes less from the industry and more from politicians.

The city of Duisburg is once again tightening the tax screw on gaming machines: From January 1, 2025, the amusement tax rate will be increased from 22 to 24 percent. This was decided by the city council on December 2.

• The aim is to relieve the city's coffers by almost 1 million euros per month - a plus that should increase the taxable revenue from gaming machines to around 4 million euros per month.
• However, the focus is not only on the additional revenue: officially, the tax increase is also intended to help reduce the spread of gaming machines and the associated risks of gambling addiction.

It will be interesting to see how Duisburg's extremely lucrative slot machine market - one of the most successful in NRW - reacts to the new intervention. One thing is clear: Duisburg's decision signals that the amusement tax can not only be a source of income, but also a political control instrument. A model that ensures stable additional revenue despite criticism. Whether the market will support this in the long term remains to be seen.

Criticism from the opposition: illegal gambling would be strengthened

Interestingly, it is not so much the slot machine operators in Duisburg who are rebelling against the latest tax increase - criticism is mainly coming from the political opposition.

• Alexander Schaary (AfD) warned the council of a possible side effect of the measure:

The higher levy could encourage illegal gambling in the city. "The city is pursuing regulatory policy on the backs of gambling addicts," said Schaary. The fear is that the tax increase will make legal machines less profitable, which could allow dubious operators with uncontrolled machines to gain ground. Gambling addicts in particular, who are especially dependent on the protection offered by regulated services, would suffer as a result. Speaking of player protection: we recently reported that the differences in high-risk and pathological gambling behavior between Germany and Switzerland are small, although our neighbors have much more freedom to gamble.

• But the city administration vehemently disagrees:

Michael Rüscher, Duisburg's alderman for economy and order, sees no danger of an expansion of the illegal market. On the contrary, Duisburg is a "nationwide leader" in the fight against unregulated gambling. According to Rüscher, regular checks and a specially established working group ensure a high level of control. "Other cities envy us for our consistent enforcement," he emphasized. Incidentally, 45 illegal gaming machines were recently destroyed in Frankfurt am Main in a high-profile move to set an example against such criminal activities.

• Lord Mayor Sören Link also sees no legal hurdles:

The city is guided by current case law and is in contact with other municipalities. In fact, tax increases to 24 or even 25 percent are not uncommon in North Rhine-Westphalia: cities such as Oberhausen, Mülheim and Emsdetten have established similar rates. Duisburg is therefore by no means alone - and would be able to assert this argument in court if necessary. Brake in Lower Saxony also recently saw a tax increase to 25 percent, although the increase amounted to 5 percentage points.

Slot machines in Duisburg on course for success with potential monthly revenue of 4 million euros

Despite the rising tax burden, the slot machine business in Duisburg remains a real success story. The city already increased the tax rate from 19 to 22 percent in 2020, but instead of slowing down the business, gaming revenue actually continued to increase.

• According to regional reports, the average monthly revenue from machines in gaming arcades rose from just under 3 million euros to over 3.08 million euros between 2021 and 2023.
• There was also an increase for machines in restaurants and other locations: here, monthly earnings grew from 814,000 euros to around 956,300 euros in the same period.

The figures illustrate how robust and lucrative the market for gaming machines in Duisburg is - even under stricter tax conditions. Interestingly, the number of registered gaming arcades and machines is also rising steadily. An indication that the industry continues to flourish.

The development of amusement arcades and machines in figures from the Duisburg city administration:

Source of the image: https://pixabay.com/photos/taxes-tax-consultant-finance-money-1032643/