The Latvian Government has accelerated plans to increase gambling taxes, moving the implementation date from 2027 to 1 January 2026.
The decision forms part of broader fiscal measures outlined in the Ministry of Finance's report on priority measures for the 2026-2028 state budget framework.
Under the revised timeline, gambling tax rates will rise from 15% to 18% beginning next year. Interactive gambling revenue taxes will increase from 12% to 15%, while telephone-based gambling taxes will climb from 15% to 18%.
Annual taxes on table games will rise from €33,696 ($39,500) to €40,440, with gaming machine taxes increasing from €6,204 to €7,440 annually.
The accelerated tax implementation responds to fiscal constraints identified in Latvia's 2025 Progress Report on the Fiscal-Structural Plan for 2025-2028.
The report concluded that fiscal space for the next budget cycle is negative, prompting the Cabinet to target efficiency measures reducing general government expenditure by at least €450m across 2026-2028, including €150m in 2026.
Latvia's Ministry of Finance estimates the gambling tax increases will generate an additional €9.2m annually, with €175,000 distributed to municipalities.
The tax adjustment occurs amid increased defence spending requirements following European Commission guidance for EU member states to utilise flexibility measures under the new economic governance framework.
Latvia activated the national escape clause in July 2025, allowing deviations from approved expenditure growth paths to accommodate higher defence spending levels.
The gambling industry thus joins other sectors contributing to Latvia's fiscal consolidation efforts as the Government navigates competing priorities between defence requirements, demographic measures and overall budget sustainability.
