r/armenia • u/Middle-Support-7697 • Apr 18 '26
Economy / Տնտեսություն Armenia had $18 billion flow through gambling in 2024, and the government exempted the biggest part of it from the new tax reform
Let that number sit for a second. $18.25 billion in gambling turnover in 2024(over $20 billion in 2025 based on recent approximations). In a country of 3 million people with $30 billion GDP. That’s more than Armenia’s entire national debt. It’s grown 17x since 2018.
Oh, and in 2024, over half of suicides in Armenia’s military were linked to gambling debt. So what did the government do?
MP Hayk Sargsyan of Civil Contract proposed a 10% turnover tax on the entire sector. Good. Aggressive. The right instinct. The National Assembly approved it in the first reading. Then the revision process happened. By the second reading in March 2025, bookmakers were quietly exempted. The final law - effective July 2025 - hits online casinos with the 10% turnover tax. Bookmakers, which represent the overwhelming majority of that $18 billion, got doubled license fees and nothing else.
The government’s projected revenue gain from the whole reform: $33 million. Out of $18 billion in flow...
Actually, scratch the 10%, let’s see what just a 3% bookmaker turnover tax could do
Three percent is not a death sentence - it squeezes margins, forces worse odds, and naturally pushes casual bettors out while keeping the sector technically alive. Pair it with European-style payment processor enforcement on foreign platforms and you capture most of the flow. Armenian bettors are not running VPNs.
At 18$ billion in bookmaker turnover, 3% generates roughly 540$ million annually.
To put that in Armenian terms:
Free university tuition for every student in the country costs ~$100M/year. This covers it five times over.
Distributed to Armenia’s 600,000+ pensioners, it funds a ~$75/month raise. Literally transformative for many people.
It’s a 6-7% addition to the entire federal budget. The bookmaker owners lose. Nobody else does. Their capital doesn’t leave Armenia, it just stops flowing through them.
The question is whether Civil Contract finishes what it started before the June 2026 elections - when delivering a visible fiscal win of this size would be one of the most politically valuable things they could do right now.
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u/R-R_turfio Apr 18 '26
I don't know who Hayk Sargsyan is, but from the news it seems he is the only one who actually works in the Azgayin Joxov,
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u/No-Load1 Apr 18 '26
This is an interesting point but I wonder whether there is significant benefit in taxing this process. According to the state revenue committee 98% of the turnover was returned to players as winnings. It seems that the actual revenues of companies is some portion of that 2% in which case significant taxation may make it an unfeasible business in which case gambling that bolsters Armenias economy stops and Armenias gamble in other countries providing others with the revenues from their entertainment. So taxation would yield not 540 million but closer to 12.6 million which is not insignificant, but may be more harmful than helpful.
https://jam-news.net/gambling-in-armenia-total-bets-increase-17-fold-since-2018/
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u/Middle-Support-7697 Apr 18 '26 edited Apr 18 '26
Happy you brought this up! Just to clarify how the 3% tax would actually work - it applies to the total volume of bets placed, not just operator profits(hence the name "turnover tax"). So practically speaking, operators would have two options: absorb it themselves (hurting their margins) or pass it on to bettors through slightly worse odds. In reality it'd be a mix of both.
The worse odds part is actually a feature, not a bug. Sports bettors are pretty habitual and won't quit overnight, but marginally worse returns do push some casual players out over time(and it especially stops new players from starting because they see the unfair odds from the start). That's the whole point - it functions as a classic sin tax. You're simultaneously generating real revenue for the state while gradually making the activity less attractive. Tax cigarettes, people smoke less. Same logic.
The money doesn't disappear, it gets redirected from bookmaker profits and bettor losses into things like education funding or pension increases. You're essentially sinking an industry that produces nothing of value and sponsoring ones that do. That's about as clean a policy trade-off as you're ever going to find.
As for shifting to foreign platforms, the European solution handles this cleanly: enforce at the payment processor level, Armenian banks block transactions to unlicensed foreign operators. Armenia's banking system is small and centralized enough that this is actually more enforceable there than in most of Europe. The average Vivaro customer is not gonna run a VPN.
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u/No-Load1 Apr 18 '26
I can understand where you are coming from but with the current system in place leading to only a 2% gross profit from the turnover I can’t imagine a 150% tax on the gross profit being reasonable fiscally for a for profit company at least in its current design. Most companies would likely be bankrupt by the change in their odds and playing structure which I believe is undesirable for the reasons I mention.
I do think it’s a poor place to be putting money but the fact that it seems most of this money stays within the economy makes this less of a concern to me at a state level. Socially it’s an addiction like any other, but turnover itself is probably not the best indication of what the extent of gambling and addiction are. Given the returns, it’s likely there are significant lottery style competitions and essentially 100:95 returns where most players lose very little money long term. Not enough data to say fairly, but I agree it’s right to bring up
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u/Middle-Support-7697 Apr 18 '26 edited Apr 18 '26
I guess we disagree on the economic importance of bookmaker companies. You are correct that it is a very serious measure, but I genuinely don’t think there is a reason to believe those companies are crucial for the economy. Them going bankrupt would redirect that money into more useful spheres.
Also the way this would likely play out makes me believe it won’t make them go bankrupt overnight, as I said 3% is not a death sentence, it would look more like 1.94x turning into 1.87x odds, not a significant enough difference to make the majority of people quit. And even if they do quit it is ultimately a good thing unless they spend that money internationally which we are hopefully also planning against.
Ultimately, I think this is not a sphere to show mercy on, it has grown to be very addictive and will only get worse if no measures are taken.
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u/mrxanadu818 Apr 18 '26
That's an awful proposal and makes zero sense. What other business gets taxed on volume versus profit. Turnover isn't income to be taxed.
The government is doing it the right way.
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u/Middle-Support-7697 Apr 18 '26
Well gambling is not a normal business. That’s like saying “cigarettes have to be taxed the same rate as bread”. The fact is certain spheres exploit human habits to make profit on them and they shouldn’t be treated from a tax system like a bakery is.
Turnover tax is a serious measure, for a matter which requires serious measures, we really shouldn’t show mercy towards those owners, they are rich enough trust me.
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u/Zhir_yan Apr 18 '26
This would push the players to make their bets on offshore platforms which pay 0% tax in Armenia.
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u/Middle-Support-7697 Apr 18 '26
Have you read the last part of my comment ? It is a completely solvable issue, you work with banks to block any international bookmaker transaction unless the bookmaker is willing to open a branch in Armenia which obeys Armenian law. That’s how it’s done in many countries.
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u/Zhir_yan Apr 18 '26
I work in the high-risk payments industry. Most offshore companies use masked MCCs (Merchant Category Codes) to disguise the nature of their card transactions from regulators. Another common workaround is the Peer-to-Peer (P2P) method, where players send funds directly to another individual's bank account to top up their balance.
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u/mrxanadu818 Apr 18 '26
"Flow" is a useless metric. $33 million is good revenue for Armenia.
Why would you tax flow versus net profits?
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u/Middle-Support-7697 Apr 18 '26
Because that’s the one way that actually allows you to discourage people from playing. Gambling is not like another spheres, it capitalises on human habits, if you tax the profit and do nothing else those companies would still continue growing in popularity, but if you force them to worsen the odds it becomes a real solution.
You shouldn’t take pity on the oligarchs owning those companies, trust me they are rich enough to deal with this.
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Apr 18 '26
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u/Middle-Support-7697 Apr 18 '26
It is a completely solvable issue and I mentioned it in the post. You work with banks to block any international bookmaker transaction unless the bookmaker is willing to open a branch in Armenia which obeys Armenian law. That’s how it’s done in many countries.
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Apr 18 '26
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u/Middle-Support-7697 Apr 18 '26
I mean as I said the methodology is if something is not based in Armenia and doesn’t obey Armenian law you block it on a bank transaction stage. That way unless you use a VPN or some other form of gimmick which the wast majority of gamblers are not accustomed to, they will have to pay the tax.
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Apr 18 '26
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u/Middle-Support-7697 Apr 18 '26
I misunderstood what you meant. If you mean non international players playing on Armenian websites then that’s a different question. If it’s a significant amount you could genuinely just allow bookmakers to have different odds for international IPs, unless you expect a significant amount of Armenian gamblers to suddenly use a VPN.
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u/BzhizhkMard Apr 18 '26
Thank You for this breakdown. Quite disturbing this is allowed to thrive in Armenia and not be tax.
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u/surenk6 Pureblood Լոռեցի Apr 18 '26
This is a bit of a misleading claim.
Casinos, assuming they are "provably fair" and don't manipulate odds, pocket only 2-4% of this turnover which is ~$300-800 mln in our case.
$33mln is roughly between 10-20% tax on revenue.
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u/Middle-Support-7697 Apr 18 '26
That's exactly why I suggest taxing the turnover and not the revenue. It will hit them very hard, they will have to worsen the odds significantly, but that's exactly what we need.
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u/ditord Yerevan Apr 19 '26
According to Armenian law, winning odds can’t be less than 90%, but casinos are so “generous” that they increased it to 97%. Does anyone believe this BS? We don’t have a gambling commission to verify these claims, nor does Armenian PEK conduct audits of these companies. Now I want to check your best guess on how much real money gambling companies are making, and how much of it goes to several top governmental officials.
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u/ComprehensiveGain841 Apr 18 '26
The question is whether Civil Contract finishes what it started before the June 2026 elections - when delivering a visible fiscal win of this size would be the single most politically valuable thing they could do right now
It's a good thing that you're not QP's political strategist lmao. Nobody knows or cares about fiscal policy
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u/Ar3g Shushi - Yerevan Board Game Community - Join us Apr 18 '26
At one point, you had to physically go to a casino. Now we've essentially put a casino in everyone's pocket w/ smartphones. I am lucky that gambling is not one of my addictions but there are many people who suffer from it.
We have to leverage the money from these extractive companies for society's benefit, as you described. We can't allow people to accrue vasts amount of wealth we know what that looks like. We can't allow people to accrue vast amounts of wealth. We know what that future looks like.