Estonia’s Government is reconsidering a planned reduction in the online casino tax following concerns that the measure is failing to attract new operators or generate the expected additional tax revenue.
Prime Minister Kristen Michal announced that the Government will discuss whether further tax cuts make sense. This development was already reported by the Global Gaming Insider last week.
Most recently, the Chairman of the Riigikogu’s (Parliament) State Budget Control Select Committee said the state is forecast to lose €31m in revenue as a result of the online casino tax rate cut. In the first seven months of 2026, gambling tax revenues totalled €3.36m, down 9.7% from the previous year.
Margus Allikmaa, head of the Cultural Endowment Foundation, said his institution is expected to lose €4m this year and next.
The Estonian Parliament adopted the 2026 state budget on 10 December 2025, with the changes taking effect on 1 January 2026. The amendments to the law were intended to reduce the online gambling tax rate from 6% by 0.5 percentage points each year until it reached 4%.
The policy aimed to make Estonia a more attractive hub for online gambling operators, similar to Malta.
Meanwhile, Tanel Thein, the initiator of the tax rate reduction for online casinos, stated that his position has not changed. He added that it is premature to talk about reinstating the previous rate.
Thein stated that the decrease in gambling tax revenue cannot be attributed solely to the reduction in the online casino rate.
He noted: "The 9.7% reduction in overall gambling tax revenue is not a 'loss' from the reduction in the tax rate for online casinos. With the amendment to the law, we changed the rate specifically for online gambling.
"However, the overall revenue also includes Eesti Loto and traditional gambling, for which this reform did not reduce the tax rates. Furthermore, the start of 2026 was affected by an error in the law, which took two months to correct."
A drafting error in the regulations Thein refers to unintentionally exempted online casinos from their tax obligations at the beginning of this year. Lawmakers subsequently amended the law to close the loophole, with the new provisions taking effect in early March.
By mid-March, online gambling operators had voluntarily paid more than €1.4m in tax following the loophole. Based on operators’ reported income for January and February, the estimated tax liability for online gambling had been approximately €3.5m.
Earlier, the Prime Minister voiced the same conclusion: it might still be too early to determine whether the tax cut has attracted more online casinos.
The Ministry of Finance noted that a six-month notice period must be observed when reversing the decision
