• A new tax regime has commenced in Armenia, imposing a 10% turnover tax on all licensed gambling activities as of 1st July 2025.
• The measures, which also include significantly higher and escalating licence fees, have drawn sharp criticism from domestic operators and initial resistance from the nation’s Ministry of Finance.
• Proponents in the government argue the tax is necessary to control a rapidly growing market and address social harms, projecting an additional €32 million in annual state revenue.
• Industry stakeholders warn the fiscally aggressive model is unsustainable, risking the viability of the licensed market and potentially driving activity towards grey operators.
• The reforms are being enforced amidst regulatory uncertainty, pending the formation of a new, dedicated gambling authority.

A New Fiscal Reality for Armenian Operators

As of the start of this month, Armenia’s gambling industry is operating under a fundamentally altered and contentious fiscal framework. The government has officially implemented a 10% turnover tax, a measure approved by the National Assembly earlier this year, which applies a blanket levy on the turnover from all forms of gambling, including casinos, online gaming, sports betting, and lotteries.

This tax is compounded by steep increases in licence fees, which began in April. Online casino operators meeting certain turnover thresholds are now required to pay AMD 350 million (approx. €825,000), with betting firms liable for AMD 100 million (approx. €235,000). These fees are structured to increase annually via a multiplier system, potentially reaching five times their initial value by January 2028. This escalator clause will only be halted if the government successfully establishes a new regulatory body.

Government Justification and Industry Rebuttal

The reform was spearheaded by MP Hayk Sargsyan of the ruling Civil Contract Party, who cited the sector’s explosive growth as justification. With market turnover reportedly reaching the equivalent of €15 billion in 2023 and over €1.9 billion deposited into online casino accounts in 2024, the government has argued for a more assertive fiscal and social policy. Sargsyan has labelled gambling a “systemic issue,” stating the reforms are crucial for the “moral and economic stability” of the country.

However, these measures have been met with significant resistance. Notably, the Ministry of Finance initially expressed reservations, warning that such drastic tax increases could destabilise the regulated market and inadvertently boost unlicensed, grey market operations.

Domestic businesses echo these concerns, arguing that while the government may see short-term fiscal gains, the long-term health of the licensed industry is at severe risk. They contend that the combination of high, fixed upfront costs and a turnover-based tax-which taxes revenue rather than profit-creates an unsustainable operating environment that will deter future investment.

An Uncertain Future

The industry now faces mounting fiscal pressures in a climate of significant regulatory uncertainty. The next critical step in the government’s overhaul is the establishment of the ‘Gaming Sector Monitor and the Gaming Operator Institute’, a new authority tasked with compliance and oversight. Until this body is fully functional, operators are left to navigate the challenging new conditions without clear regulatory leadership.

With these changes, Armenia joins a small number of jurisdictions that have adopted a turnover tax model. This approach is widely scrutinised within the global iGaming industry for its potential to distort market pricing, severely limit operator margins, and ultimately reduce the competitiveness of the licensed sector.