Poland is experiencing a growing shortfall in gambling tax revenues due to continued dominance of unlicensed online casino platforms. Despite implementing a state-run monopoly in 2017 through the launch of Total Casino, the government has been unable to control a large portion of the market. In 2023, the country lost over PLN 0.5 billion in potential gambling tax revenue, as offshore operators, often based in jurisdictions like Malta or Curaçao, continued to attract Polish users. The state monopoly was introduced as part of a broader strategy to combat gambling addiction and reduce the size of the unregulated market. However, instead of increasing state oversight, the approach has led to a parallel, unregulated system where over 40% of online casino activity continues outside the legal framework. These offshore platforms operate without adhering to Polish legal, tax, or consumer protection obligations and remain accessible to local users, often without their full understanding of the legal risks involved. Since Total Casino began operations, the share of illegal operators in the market has remained high. Users are frequently directed to these sites through online advertisements, misleading content, and search engine-optimized materials that present unlicensed services as legitimate. Many players are unaware that using such platforms violates Polish law. As a result, those affected by fraud or unfair practices are often hesitant to report their experiences due to concerns over possible legal consequences. The state’s attempt to control the online gambling market through exclusive operation has proved ineffective. Total Casino faces competition from offshore entities not subject to Poland’s tax or regulatory framework, including restrictions on advertising and operational costs. Estimates suggest that 83% of users continue to engage with unlicensed platforms, despite legal alternatives. The scale of the issue has widened in recent years. Since 2018, the tax gap in the gambling sector has grown by more than 50%. Experts argue that the problem lies not with the existence of online gambling itself, but with the current regulatory model, which positions the state as a market participant rather than an independent regulator. According to Piotr Palutkiewicz, Vice-President of the Warsaw Enterprise Institute, Poland could reduce the scale of the grey market and increase tax revenues by adopting a licensing model. “Most EU countries regulate online casinos through licensing systems, and Poland has already implemented such a framework for sports betting,” he noted. “A similar approach to online casinos could reduce the grey market to around 16%, increase annual tax revenues by over PLN 370 million, and generate new legal employment opportunities.” Such a licensing-based model would also impose higher compliance requirements on operators, including obligations for anti-money laundering measures, responsible gambling tools, and data protection. Experts suggest that reform is necessary to establish a more effective regulatory environment—one that balances consumer safety, legal clarity, and fiscal responsibility. Source: WEI