Bulgaria has introduced a proposed measure that would limit the fees banks, payment institutions and e-money providers can retain from gambling-related transactions to 1.5%.

The initiative would create a new approach to taxing gambling-related financial services within the European Union, shifting part of the focus from gambling operators to the payment infrastructure supporting the sector.

Under the draft provisions, the 1.5% limit would apply to fees charged for two types of transactions: deposits made for participation in gambling activities and payments of gambling winnings.

If a payment provider charges a fee above the permitted threshold, the amount exceeding 1.5% would not remain with the provider. Instead, the additional amount would be transferred to the state budget.

For example, if a customer deposits €1,000 and the payment provider applies a 3% fee, amounting to €30, the provider would be able to retain only €15. The remaining €15 would be paid into the state budget under the proposed mechanism.

The draft also introduces additional reporting and monitoring requirements for payment service providers. Companies handling gambling-related payments would be required to keep relevant records and submit monthly declarations detailing the fees collected from such transactions.

If adopted, the measure could put downward pressure on gambling payment fees, potentially bringing them closer to the proposed 1.5% ceiling and reducing transaction costs for customers.

According to the rationale behind the proposal, the measure is intended to increase accountability among companies generating revenue from gambling-related payment services. Bulgarian policymakers also point to the significant volume of gambling transactions and the important role played by payment providers in enabling them.

The accompanying impact assessment describes gambling payments as a higher-risk area and argues that payment providers benefiting from this activity should contribute to public revenues.

Under the proposed framework, the portion of processing fees exceeding the 1.5% threshold would therefore become an additional source of state revenue. While the measure could potentially provide funding that might support initiatives addressing gambling-related harm, the proposal does not currently specify how the additional revenues would ultimately be allocated.