PokerStars.fr, the French-regulated client of PokerStars, announced last week to its Austrian player base that it will no longer be servicing players residing in the country starting at 10:00 ET on March 1, 2016. The notification informed Austrian players that a change in regulatory framework is the reason they will no longer be welcome to play on the French PokerStars client.
Upon the news, poker players flocked to poker forums, including TwoPlusTwo, to discuss the news along with the reasons this is taking place. The email Austrian customers received explains that players can still use their StarsCoin balances to purchase items in the VIP Store and the site will automatically convert tournament dollars and tickets into cash.
Here is the message players received last week:
We are writing to inform you that, due to the latest change in legal framework in Austria, starting at 10:00 ET on March 1 we will stop allowing players based in Austria to play on the PokerStars.fr site.
Your PokerStars.fr account will remain open and accessible, and your funds can be withdrawn at any time to your registered bank account. Any tournament tickets or T€ balance will automatically be converted into Euro when you visit the cashier.
You are welcome to use your StarsCoin to purchase cash rebates or any other items from the VIP Store, with the exception of online tickets. Please also be informed that your real money and StarsCoin balances cannot be transferred between accounts on different licenses.
Players speculated that the reason for the pullout could have related to a recent deal announced between Playtech, the owner of the iPoker Network, and Win2Day, owned by Austrian Lotteries and Casinos Austria, where the former would provide poker platform services to the latter could have been the reason of the pullout due to the timing. Even though Win2Day is currently the only online poker network licensed in Austria under its gaming regime, this news appears to be just coincidental and unrelated.
However, this is not believed to be likely the case, as Austrian TwoPlusTwo poster "DebtsNBooze" shared an email PokerStars.fr support sent when asking for an explanation.
On January 1, 2016, PokerStars started paying gaming duty taxes to the Austrian Government for play on PokerStars.FR by players who had a registered address in Austria.
This additional tax was in addition to the tax that PokerStars was already paying to the French government for play by all players on PokerStars.FR.
It was unsustainable for PokerStars to pay double tax – to both the Austrian and French Governments – for play by Austrians on PokerStars.fr. Consequently, we have little choice, and need to stop allowing players with a registered address in Austria to play on PokerStars.fr.
Please note this is only for Austrian players.
We appreciate your understanding.
The double taxation issue is a sticky one. Due to French regulations, online poker operators are taxed approximately 37 percent on gross gaming revenues. The large tax already puts a significant dent into the profit margins for any online poker company providing regulated services under a French license.
Austria, who does not exempt online gaming from the EU VAT Directive levies a large 20-percent tax on all gaming transactions. It is therefore logical that PokerStars.fr came to the decision to discontinue services to Austrian residents.
This isn't the first time PokerStars.fr pull out of a gaming market due to double taxation. In December 2014, the United Kingdom began enforcing the United Kingdom Gambling (Licensing and Advertising) Act 2014 which includes a 15 percent Point of Consumption Tax to online gaming companies.
PokerStars.fr informed players in the United Kingdom in September 2014 its plans to pull out of the market ahead of the schedule plans being enforced.
Stay tuned to PokerNews for more news as it happens in the Austrian gaming marketplace.