The Latvian government has confirmed plans to increase gambling taxes as part of the 2026 budget. Initially expected to take effect in 2027, the deadline has been brought forward to January 1, 2026. Lawmakers also plan to dissolve the Independent Authority for the Supervision of Lotteries and Gambling (IAUI) and merge it with the State Revenue Service (SRS) on April 1, 2026, three months ahead of schedule.
Latvia Brings Forward Gambling Regulatory and Tax Reforms: What’s on the Agenda?
- Starting January 1, 2026, online gambling taxes in Latvia will increase from 12% to 15% of Gross Gaming Revenue (GGR), while telephone-based betting services will attract 18% taxes, up from the current 15%.
- The government will also merge the gambling regulatory body (IAUI) with the SRS on April 1, 2026, three months earlier than anticipated. Both agencies will continue to discharge their duties independently until then.
- The decision comes after a high-level government meeting regarding funding for national priorities, including education, security, and family support, concluded. Ministers agreed on measures to raise an additional €565 million for the cause.
Reformed Gambling Tax Framework to Fuel Domestic Development
The Latvian government will increase gambling taxes from January 1, 2026, a year ahead of schedule. Authorities confirmed the decision after a high-level meeting in August. Starting next year, online gambling will be taxed at 15%, up from the current 12%, and telephone-based betting services will attract 18% tax, instead of the current 15%.
Land-based operators must also shell out higher fixed annual charges. Taxes on gaming machines will increase from €6,204 to €7,440. While taxes on card, roulette, and craps tables will rise to €40,440 annually from €33,696. According to the Ministry of Finance, the revised tax structure is expected to generate an additional €9.2 million in revenue.
While €9.025 million will be earmarked for state expenses, municipalities will receive €175,000. The government has also allocated special funds amounting to €565.5 million in the 2026 budget. The authorities plan to spend an additional €320.3 million for security, €94.8 million for family support, and €45 million for education.
Finance Minister Arvils Ašeradens confirmed that this plan will boost state initiatives. While most of the funds will be generated by expense restructuring, the revised tax structure will provide additional resources. The draft 2026 state budget is scheduled for cabinet approval on October 14, and will be submitted to the parliament the following day.
Gambling Regulatory Reforms Currently Underway
Minister Ašeradens also confirmed plans to merge the Independent Authority for the Supervision of Lotteries and Gambling (IAUI), which focuses on licensing and regulatory compliance, with the State Revenue Services (SRS), which handles tax matters. Both organisations currently discharge overlapping responsibilities in terms of investigation and enforcement.
The merger is scheduled to take place on April 1, 2026, three months ahead of schedule. This is a planned move by Prime Minister Evika Siliņa’s cabinet to eliminate regulatory friction between the two organisations. It will also improve financial control and strengthen anti-money laundering and countering the financing of terrorism. Ašeradens explained:
The integration of gambling oversight into the State Revenue Service will allow us to establish unified management faster, make better use of our resources and deliver higher-quality services to the public.
The announcement comes at a time when several of Latvia’s European Union peers are updating their gambling regulations to include remote gambling operations. Just recently, Ireland received the EC’s clearance to introduce new gambling licensing regulations. These steps lay the groundwork for a safer gambling ecosystem for EU residents.