Lithuania is considering several changes to its gambling regulations. At the beginning of November, the Lithuanian parliament introduced a new “unified gambling level” of 21 years, which will come into force on July 1, 2025. Several days later, the ban on gambling advertising passed its first reading. The initial restrictions will take effect in July 2025, with the full ban coming into force in 2028.
Also earlier, Lithuania’s parliament approved an increase in the gambling tax rate from 20% to 22%, set to take effect on January 1, 2025.
Liutauras Ulevičius, president of the National Gambling and Gaming Business Association of Lithuania, in an interview with SBC Eurasia, was critical of the piecemeal regulatory efforts by individual lawmakers and the Ministry of Finance, advocating instead for comprehensive reforms modeled.
– Let’s start with the recent decision to increase the gambling tax rate from 20% to 22%. What impact do you foresee this change having on operators in Lithuania?
– This change will likely harm smaller operators providing games with limited parameters, which have a limited profit margin, pushing some — perhaps up to seven or eight companies (out of 14 in the market) — out of business. For the market leaders, however, the outlook is positive. With strong profit margins, they can absorb the tax hike and potentially expand by taking over the market share left by smaller players. Dominating casino games and betting (in H1 2024 GGR of these was 99,8 mln € out of 148,7 mln € from total gambling services) will benefit step-by-step and remain with competition in an increasingly oligopolistic market.
The author of the initiative to raise the tax tariff estimates this change will bring in an extra 4 mln € annually for the state budget, which will raise additional revenue for social programs. However, this doesn’t account for the potential market exits of smaller operators, along with lost jobs and locations. Most probably the final result for the state would be negative.
Our association estimates suggest a progressive tax model would be far more effective for the market structure we have in Lithuania. Currently, about 94% of profits go to three companies, with one major operator making around 52 mln € profit in 2023 out of 68 mln € in the whole market. Moreover, the profit margin of this operator is approximately 54% from GGR. A progressive model, like for casinos in Germany, could potentially yield 34 mln € in revenue. Unfortunately, politicians in charge seem either unwilling or unable to consider this option due to signs of corruption.
– Recently the Lithuanian parliament also increased the legal gambling age. How effective do you think this will be, and what else is needed to prevent problem gambling?
– To tackle problem gambling, it’s essential to understand who’s most affected, and where the problems originate. A group of scientists from Mykolas Romeris University conducted longitudinal studies according to DSM-IV methodology on problem gambling prevalence in 2017 and 2022. Insights show that the main risk group is young successful professionals, mostly men aged 30 to 40—not those aged 18 to 21.
Therefore, when we analyze the growth of requests in the self-exclusion register, we see a clear correlation between the growth requests and GGR of online casino games and betting (these dominate online).
Raising the minimum age contradicts European practice. Betting is mostly available for people from 18 years, except Belgium and Estonia, having the same 21-year limit. While Lithuanian B category games (kind of British B1 or AWP-with-payout) would most probably be global exceptions, allowed only for those with 21-year limit.
At the same time, earlier mentioned problems with online casino gambling will have zero effect because casino games are available only for those having 21-year since the legalization of gambling in 2002.
This proposal seems like a red herring, introduced without supporting data, likely to benefit the major casino and betting operators by forcing out lower-risk gambling options, like limited fixed betting.
Raising the age limit will do little to address problem gambling and could even create new issues. For instance, online lotteries (with unlimited stakes and very short cycles), still accessible to those under 21, remain excluded from these restrictions. Ultimately, raising the limit will push limited-risk games out, further concentrating the market on higher-risk online gambling options.
– What strategies do you think should be used to prevent young people from developing gambling problems, both from the industry and government perspectives?
– The solution to problem gambling starts with differentiation and proportionality. The higher the social risk, the lower the supply, and access is limited. And vice versa. As seen in the UK. From the local authorities and members of the parliament, we rather frequently hear the false idea that all gambling types are similar; all gambling types have a similar risk ratio, which is inaccurate from an academic point of view. To understand and address gambling risks, policymakers need to consult research and theory, but instead, they impose more and more restrictive measures that don’t work. Politicians must compare and learn best practice solutions. But in spite of that, we see initiatives with clear signs of corruption.
Since 2020, despite added restrictions, gambling spending has doubled (total GGR in the market in 2020 was 150,4 mln €, while in 2024 H1 it has already reached 148,7 mln €), correlating directly with an increase in self-exclusions due to high-risk online gambling.
Regarding companies, the real problem is that the government collects additional taxes, claiming they’ll fund prevention programs, but that money isn’t directed toward education or prevention efforts. Industry operators, meanwhile, feel less incentive to act because they see the government taking funds for prevention. Ultimately, the industry could do more, but it lacks resources because those funds are always redirected through additional increasing taxes and useless new bureaucratic requirements.
– You mentioned the self-exclusion registry. Do you see this as a positive step by the government?
– It’s better than nothing, but self-exclusion is just a small piece in addressing gambling-related social issues. The register does not analyze requests – it is impossible to establish where the player played, what games, in what establishments, and so on. The administrators themselves admit that there is no medical control – even people who have never gambled can be entered in the register. Thus, the register becomes only a scarecrow for politicians.
By the time someone registers for self-exclusion, they have already acknowledged having a serious problem. While it can be beneficial, it only helps a small number of people. Effective prevention requires strong regulatory measures and a well-structured market with risk-based restrictions, related to the level of risk. It should be controlled by placing limits on the intensity of gambling and fixing limited parameters. The higher the risk, the fewer the locations for such games, and the stricter the access barriers.
Unfortunately, in Lithuania, the market structure is inverted, with the highest-risk services being the most accessible.
– Given the trend toward restrictions, Lithuania has once again tightened its rules on gambling advertising…
– Advertising here isn’t particularly liberal, but we can promote operator names (brands) and types of gambling. This has led to excessive volume, where ads simply repeat “gambling A, B, C, company X” without creativity or educational content. Recently, the outgoing government proposed (and the parliament adopted) a ban on all gambling advertising except sports betting, which could gradually take effect by 2027. However, this could change with the new government.
From our perspective, the current approach to advertising is flawed. Regulations treat all gambling types as if they carry the same risks, which is misguided. For example, lotteries face almost no advertising restrictions, while other forms, like bingo, are lumped together with high-risk casino advertising. We believe advertising regulation should be tailored based on the risk level of each type of gambling. Now the government has proposed to make an exception for betting – as if it were a gamble with less social risk. But obviously, this is just a courtesy to the media corporations who are so guaranteed a remaining advertising budget. And in reality, it’s a clear sign of a corrupt decision. Our approach is based on the idea of reducing the intensity of advertising and setting a ceiling on its volume – this would help in the fight against the oligopolistic of the market, where 3 companies dominating online casino games and betting earn about 94% of the profits in gambling.
At the same time, the unlimited advertising of lotteries needs to be addressed. Online versions compete directly with other types of gambling, so unlimited advertising for them distorts the entire gambling ecosystem.
– Looking ahead, where do you see Lithuania’s gambling industry going, especially with a new government? Do you expect any major changes?
– It’s complicated, and I don’t expect much from the new government. True reform requires a deep understanding of the industry, and I don’t see new parliament members gaining that insight quickly. The regulatory body, which falls under the Minister of Finance, will largely remain the same, with the same people in place. While the government might take a slightly different approach (for example, introduce a progressive tax tariff model for casino games), I doubt we’ll see significant shifts given the influence of dominating market players. Of course, there is an option to listen to our advice and create a working group that could take up and implement the idea of a comprehensive reform. But this requires competence and realization of the scale of the reform.
Looking forward, a key regulatory change will come in 2027, when all physical gambling locations will need specific permission from local councils. This bureaucratic hurdle will likely be insurmountable for most operators providing gambling services with limited parameters, who lack the lobbying power of larger casinos. Out of the current 250 gambling sites, I’d be surprised if more than 50 can meet these new requirements, as municipalities can reject applications based on their own preferences. There are no general requirements in the law and then in each city, the municipalities start improvising and looking for scapegoats.
By 2027, this could lead to a drastic reduction in ground-based gambling activities, leaving mostly high-risk online options, which could worsen the problem when simple leisure activities turn into real social problems for users.
– Do you think the land-based consumer base will shift to online gambling, or will the gambling community lose them altogether?
– I don’t think land-based users will disappear. They’ll change their habits, possibly shifting from betting to lotteries, but they won’t exit the market entirely. If land-based venues close, players will likely move online, which is unrestricted in Lithuania with dominating online casino games and unlimited parameters — you can bet a million sitting on your couch or even in bed before falling asleep. In contrast, Germany enforces strict limits on online gambling – a monthly limit of 1 000 €, a maximum stake of 1 €, and a minimum cycle of 5 seconds, which we could learn from.
– In our interview, you often refer to other markets’ regulatory schemes. If Lithuania adopted practices from other EU countries, which would you choose?
– Our association has been operating since 1994 – in three decades we have seen different approaches not only in Lithuania, but we analyze best practices from leading countries of the world.
For land-based gambling, the optimal solution would be the UK’s or Spanish model of a heterogenic market, structured risk-based pyramid. ‘Light’ games with limited parameters would dominate and players would have a chance to choose different types of gambling. Social risk would be regulated by the difficulty of access to gambling services.
For online, I would say the German model, where the emphasis is on game parameters such as limited maximum stake, monthly limit, and minimum game cycle. Additionally, keeping in mind the problem of oligopolistic Lithuanian market structure, we need a German approach for a progressive tax tariff model for casinos when higher revenue leads to higher taxes — it would be more balanced and effective for Lithuania.
This model would balance the public interest by prioritizing the interests of the state, society, and the business environment. This contrasts with the current state policy, which has many signs of corruption.
Earlier, George Mamulaishvili, the head of the Georgian Gambling Association, spoke to SBC Eurasia about the difficulties in regulating the industry, its challenges, and its current state. You can read more about this here and here.
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