The management of the Olympic Entertainment Group (OEG), the largest omni-channel gaming operator in Eastern Europe, has announced that by closing nine betting shops and two casino arcades, it will minimise its successful Lithuanian portfolio.
The decision stems from the OEG’s performance review of its’ Baltija’ (Baltic) branch, in which governance stressed that incoming tax hikes on Lithuanian retail verticals made the properties unsustainable.
In previous statements, OEG governance had warned the Lithuanian policy advisers that if the government approved new gambling measures to increase retail taxes, it would be forced to terminate its’ unprofitable units.’
Through amending its’ Act on Lottery and Gambling,’ the government of Lithuania will raise revenue taxes on bingo, arcade and gaming to 18 percent (formerly 15 percent) with all online gambling operations expected to be fixed at a regular sales tax of 13 percent.
Of additional concern to Lithuanian incumbents, the government may move to impose’ tax base increases’ attached to gambling machines operating Category A and B, which will implement a monthly licencing fee per controlled machine unit.
Saulius Petravičius, OEG MD for Lithuania, said: “Initiatives to aggressively change the tax environment not only create uncertainty, but have also forced us to rethink and change our business model.
“We will move the activity from the closed facilities to other operating units, such as betting shops, casinos or the remote gambling platform. This is how we respond to changing market conditions so that we can ensure the sustainability of our business through legal action.”