Germany Agrees that Poker Is a Game of Skill

(Photo: Images Money)

A German court has ruled that poker is a game of skill, as Levitt has argued before (and which a U.S. court has recently confirmed).  The ruling is in response to poker player Eduard Scharf‘s claims that his poker winnings shouldn’t be taxed because poker is a game of chance, and “anyone can win a game of poker.”  The court disagreed, ruling that “[H]e had to pay income tax on his winnings saying they counted as commercial income as they were linked to his personal skills.” (HT: Sven Seuken)

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  1. Brazzy says:

    Note that Poker is still considered gambling and legal only in state-licensed venues (making online poker illegal) that *also* provide considerable tax income. It will be interesting to see which of these interpretations ends up winning, or whether the courts manage to uphold this inconsistency.

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  2. Steve Nations says:

    So am I correct in inferring that in Germany your gambling (craps, roulette, slots, black jack, lottery, etc.) winnings are not taxable? I find that very interesting.

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    • Rich says:

      Gambling winnings are not taxable in most countries, I believe. US is a big exception. Could be wrong, but that’s my understanding

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  3. Jonny says:

    Ha!
    This is hilarious.
    For so long, poker players want people to recognize that poker has a skill element. When they finally got a legal approval and recognition from a super power, they get taxed!

    Lesson: be careful what you wish for.

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    • Jeff says:

      I think I can speak for every U.S. poker player when I say we’ve asked to be regulated and taxed if it means we can play again.

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      • Mike B says:

        You mean, if it means you can start fleecing n00bs again.

        Bucket shoppes were arguably had a skill element as well, but that doesn’t mean they shouldn’t have been banned for their destructive economic consequences. Anything which employs addictive psychological mechanisms to make money needs to be highly regulated.

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  4. Philip says:

    @Jeff the Poker Players Alliance, funded mainly by overseas internet poker rooms, saying poker players agree to be “taxed and regulated” so long they can play online poker is a bit disingenuous considering this only helps the online poker rooms. Poker players’ ROI will be greatly reduced due to the triple rake of the poker room, state tax and federal tax. Therefore, making a living playing online poker will not be a viable option for the average PROFESSIONAL poker player much less any novice.

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    • Enter your name... says:

      The AVERAGE poker player loses money already, after taking into account the poker room’s take. For the average poker player, regulation and taxation results in no taxes paid, but the end of illegality.

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    • Jeff says:

      Disingenuous? Perhaps you’re referring to B&M only poker players, when I’m addressing those of us that played predominately online (mostly due to lack of B&M options). My current income is greatly reduced by taxes as well, but I’d rather be able to have a job making something than not have one and make nothing. It would be disingenuous for me to say that I’d rather have 20% of $0 taxed than 20% of $50k.

      And back to Jonny, poker players want people to recognize that poker is a game of skill with an element of luck.

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    • tarhawk says:

      You seem to assume that most professional poker players don’t pay taxes on their net winnings. I don’t have a good estimate for the proportion of US players who pay taxes on poker winnings, but I’m certainly aware that MANY do. You can see discussions of this issue in online poker forums. Even as a non-professional, I paid taxes on my online winning for years. Just because it wasn’t regulated by the government didn’t mean that it was legitimate to not pay taxes on your income. Ethical issues aside, I, and many others I know, think it would be too risky to not pay taxes.

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  5. Eric M. Jones. says:

    Mae West: “Is poker a game of chance?”
    W.C. Fields: “Not the way I play it.”
    — My Little Chickadee

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  6. Roy says:

    This is good news for you folks. Hopefully they’ll decide this in Holland too.

    Greets from Holland.

    Roy
    http://www.nodepositpokerbonus.nl

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  7. moreEV says:

    The taxation issue is key. France has regulated online poker, but introduced a punitive taxation, effectively taxing poker the same way than they are taxing lottery. This has led to a completely unsustainable market where online poker rooms close one after the other. See for instance: http://blogs.moreev.com/moreevblogger/2013/09/16/lessons-from-the-french-debacle/
    We can only hope that the US, if and when it regulates, will be smarter about taxation.

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