Russia - online gambling regulations

Online gambling regulations, laws and taxes in Russia

Gambling is a hot topic in most countries nowadays, especially since online gambling has rapidly expanded and become one of the top forms of gambling across the globe. Russia, in particular, is one country with a very interesting and confusing history regarding the legality of gambling in particular.

With the online casino industry rapidly growing and Russia’s past of banning gambling activities just to gain control over the market, there is a lot of uncertainty on their legal stance when it comes to online gambling. In this article we will be looking at the history of gambling laws, the current gambling laws as well as what the future holds for gambling, and more specifically online gambling, in Russia.

The history and laws of gambling in Russia

The history of gambling in Russia is quite an interesting and rather confusing one. In 1928 all forms of gambling were banned under Soviet rule. This ban remained in place until some rules were changed in the late 1980s. Then in 1988 slot machines were made legal, but again these were only legal in certain areas. It was only in 1989 that the gambling ban was completely lifted.

For a brief period from 1989 until 2002, there was a rapid increase in casinos operating in Russia. Moscow alone was home to more than 50 gambling houses. As gambling activities became more and more popular, the government was forced to take a stand. Their old regulations weren’t quite clear and had to be rectified.

In 2006 a law was passed banning all forms of online gambling. Before this time most of the major international gambling sites were accessible to Russian residents. With the new laws in place, the government banned not only online gambling but also restricted access to casino sites, sportsbooks and even Poker sites.

Gambling was legalized again in 2009, but this time it was limited to four parts of the country, namely: Altai Krai, Kaliningrad Oblast, Primorsky Krai and Krasnodar Krai. This lasted for about three years before the Supreme Court of Russia took the online gambling ban to the next level in 2012. In their ruling, they stated that all online casino sites must be blocked in the country. And instead of sitting around authorities started actively blocking online casino sites. To this day they’ve blocked some of the biggest online casino sites, including PokerStars and Party Poker.

While it seemed at the time that things might be doomed for the gambling industry, there was talk in 2016 that slot machines may make a return to city streets. When it comes to online gambling it is almost guaranteed that citizens will always find a way to participate, whether it is considered legal or illegal.

In 2017 the Russian legislative committee urged the Duma to approve measures that will disrupt payment processing with any unauthorized gambling sites. These measures came when new legislation was put in place to prohibit banks and payment processors from fulfilling any transactions with internationally licensed online gambling sites. The bill came into effect as yet another attempt by authorities to force local punters only to make use of Russian licensed sports betting sites.

2018 FIFA World Cup and shady online gambling activities

With the 2018 FIFA World Cup coming up in Moscow this year there are plenty of concerns about how it will affect online gambling. It is no secret that Russia has struggled immensely to control and police illegal online gambling activities, and because of this, there is a fear as to what will happen when the 2018 FIFA World Cup kicks off.

The authorities are aware of illegal gambling activities and have tried to gain control over them, but have failed to do so effectively. Now with this massive sports event coming up there is almost a guarantee that online gambling activities will soar through the roof during this time period. It is unclear what will happen or how the government aims to take control, especially during this time. However, it seems they have relaxed a bit regarding their rules on gambling advertisement during this period.

In a recent report, it was stated that the Russian authorities had amended the laws to allow betting operators more freedom when it comes to advertising their services. The Russian authorities have however attached a price to this concession, and betting operators will be required to make quarterly contributions towards Russian sport.

Are gambling winnings taxable in Russia?

Online gambling is considered forbidden in Russia, but by law, players are required to pay tax on any winnings obtained from online gambling activities. Players will have to declare their winnings, and the tax amount payable depends solely on the amount a player has won.

For instance, players who have won $100 will have to pay 13% tax on the amount. The tax rates are high, but it is still legally required for players to declare any and all winnings whether or not the activity was legal.

Is online gambling legal in Russia?

Russia is one of the countries with the most fascinating and confusing history when it comes to gambling activities. It seems that there were times when gambling was considered legal and other times when it was deemed illegal. One thing is certain and that is that the Russian authorities remain vigilant and on top of anything that can have a negative impact on residents of the country.

There has been talking of cryptocurrency betting to become legal later on in 2018, and the legal framework has already been created for Initial Coin Offerings regulations, mining taxation, and cryptocurrency in general. However, for the time being, online gambling is still considered illegal no matter which currency you use. There are still some online casinos that open their doors to Russian residents, but it has proven extremely difficult for players to actually gain access to these networks. Some players manage to bypass restrictions and get their online gambling action, but they are fully aware of the possible consequences.

If you as a player want to play at an online casino, it is wise to choose from the top-rated online casinos that have already been vetted and reviewed and are considered safe to play at. There is no certainty on whether online gambling will be banned forever or if the government will once more lift the ban, but this is something that only time can tell. There is hope that with the new legislation to legalize and regulate cryptocurrency, online gambling legalization will follow shortly after, but this will most probably only be clear at the end of 2018 or in 2019.