The government wants to introduce a new targeted deduction mechanism for lottery operators

The government wants to introduce a new targeted deduction mechanism for lottery operators. It is expected that starting from 2025, companies will transfer 5% of their core revenue to the budget on a quarterly basis. These funds should go to the development of sports. From 2026, the share of contributions will increase to 6%. Now operators are already giving the state 10% of the difference between the revenue received and the prize fund, but these funds are not enough, so it was decided to change the mechanism. Kommersant’s sources cite lack of funding for “low-income” sports as one of the reasons.

“Kommersant” got acquainted with the draft order of the Ministry of Finance, posted on the portal regulation.gov.ru on December 29, 2023, which involves introducing a mechanism for targeted contributions for lottery operators, which they will transfer to the budget of the Russian Federation; in the future, these funds will be directed to the development of sports.

Changes are proposed to be made to Art. 10 Federal Law “On Lotteries”. From the document and the summary report to it it follows that from January 1, 2025, the amount of target contributions should be 5% of the operator’s revenue from the lottery for the reporting quarter, and from January 1, 2026 – 6%.

In fact, we are talking about replacing the current deduction mechanism. Now ticket distributors already transfer to the state 10% of the difference between the revenue received and the prize fund. Targeted contributions from lottery activities are transferred quarterly to the country’s budget and then spent by the government. In accordance with the Federal Law “On Lotteries,” money must be used to finance socially significant facilities and events, including the development of physical education and sports, elite sports and the sports reserve training system.

However, the summary report attached to the text of the draft resolution clarifies that the amount of targeted deductions from lotteries “appears insufficient”, so it is necessary to increase it. Thus, the document notes that in 2023 the amount of payments amounted to 3.3 billion rubles, or 3.9% of revenue from lotteries. The Ministry of Finance did not respond to Kommersant’s request.

Since July 2014, only state lotteries have been allowed in the Russian Federation; the organizers are the Ministry of Sports and the Ministry of Finance. JSC GSL (“State Lotteries”) is the operator of the lottery of the Ministry of Sports, LLC “Sportloto” is the operator of the Ministry of Finance. The largest distributor of tickets is TK Center JSC (Stoloto brand). In 2022, the total revenue of Sportloto and GSL, according to Kartoteka.ru, amounted to about 69.1 billion rubles. In 2020, another operator appeared on the market – Sports Lotteries LLC, which distributes the National Lottery organized by the Ministry of Finance (49% from VTB structures, 51% from the President of the International Boxing Federation Umar Kremlev). The LLC’s revenue in 2021 amounted to 52.3 million rubles, data for 2022 in Kartoteka.ru are missing.

Stoloto told Kommersant that at the end of 2022, the volume of targeted contributions transferred to the budget of the Russian Federation amounted to 2.9 billion rubles, and total contributions from lottery activities (including targeted contributions, taxes and fees) amounted to 8 billion rubles. For the nine months of 2023, the volume of targeted deductions from the sale of lottery tickets amounted to 2.3 billion rubles; by the end of the year, the company expects the amount to exceed 3 billion rubles. (results will be published no earlier than March). The total amount of royalties from lottery activities of all market operators, Stoloto believes, will exceed 3.5 billion rubles. The National Lotteries did not respond to Kommersant’s request. Market participants do not comment on the prospect of increasing contributions to the budget.

Kommersant’s interlocutors in the sports management note that in the current situation, many sports that are not classified as “commercially rich” need additional funding. Therefore, Kommersant’s sources explain, “a larger volume of deductions was needed.” In October 2023, Vladimir Putin already ordered an increase in spending on the development of sports. It was proposed to do this, among other things, by increasing the target contributions of lottery operators. At Stoloto they then talked about the need to “color the funds” in order to figure out what exactly they were used for. Kommersant’s interlocutors among market participants still emphasize the opacity of the system for distributing funds.

Yulia Yurasova, Alexey Dospehov