To demonstrate its commitment to putting the interest of the poker community first, PokerStars announced the cancellation of previously introduced and announced changes at PokerStars.com and shared liquidity sites. An exception to the cancellation is the rake increase announced for the “Spin and Go” games that took effect on November 03, 2014, denoting that the new rake for the said games will still prevail.
PokerStars has rolled back the house fees on all other games to the pre-November 03, 2014 rates, while the increases planned for implementation before July 2015 have been scrapped. Simply stated, except for the new rake in the “Spin and Go” games, no changes will be implemented at the PokerStars.com and shared liquidity sites in 2015.
The announcement made clear that erstwhile and forthcoming changes are to continue in jurisdictions like Italy, France, Spain, and elsewhere in which increase in gaming duty or Value-Added Tax will, or have been implemented. Such changes will come not only in the form of increased house fees, but as sub-charges and reduced multipliers for VIP Player Points (VPPS), in countries affected by new taxes or gaming duty rates, but those that do not have their own gaming software.
Existing and Planned Changes in Taxed Countries
Rake adjustments in taxed countries will be maintained at half the amount of the value-added tax (VAT) or gaming duty that a country collects from a consumer. Generally, VAT incurred by a merchant in operating a business, is passed-on to the product buyer or service user as an added cost. In a poker-gaming facility, a VAT addition is based on the fee or rake collected from players. The operator collects the VAT and periodically remits the aggregate amount collected to the tax authority of a jurisdiction. PokerStars clarified that it will continue to observe its policy of subsidising half of the VAT, which denotes that the company will remit the full amount of VAT due to tax authorities, by shouldering half of their players’ VAT obligations.
Changes in VPP multipliers, on the other hand, entail the lowering of rewards equivalent, but the adjustment equates to less than half the VAT or gaming duty ordinarily passed on to a player. PokerStars explained that modifying the system to allow charging dissimilar house fees collected from different players participating in the same game, posed as a technical challenge; thus, the decision to reduce the VPP multipliers instead. The poker company disclosed that they have actually implemented the modifications in countries that had already put into effect their respective amended tax laws, which include Belgium and Denmark.
PokerStars Head of Communication Eric Hollreiser stated that they are aware of the diverse impact of rake increases in the poker community. He commented that the company is not anxious about making adjustments, because they pay heed to feedback received, as well as make use of new analysis. In a separate blog, Hollreiser wrote that they had done so in the past but most of the changes implemented went unnoticed and that they will still implement changes in the future, if necessary.