Chaudfontaine Loisirs: VAT on online casino games compatible with EU law: Allegations, Court Orders and Status

What this case is about

C-73/23, Chaudfontaine Loisirs SA v État belge, is a preliminary reference to the Court of Justice of the European Union from the Tribunal de première instance de Liège. The Liège court decided to refer on 30 January 2023 and the reference was received on 10 February 2023.

The casino operator challenged Belgian VAT on online games of chance. It relied on Article 135(1)(i) of the VAT Directive, fiscal neutrality and state aid rules, because lottery tickets and land-based games are treated differently. The case sits in the field of gambling tax litigation.

Who is covered

The ruling answers questions from the Belgian court, and it states how the VAT Directive is read. It matters to online casino operators taxed on games of chance while land-based gambling and lotteries stay exempt.

It also matters to operators that paid VAT and seek a refund. For the wider list of EU cases, see gambling lawsuits in the European Union.

Is there a payout?

No payout exists in this case. It is a tax dispute between an operator and a state, not a class action or settlement, so there is no fund, claim form or deadline for players.

The judgment does address refunds of VAT collected in breach of the Directive. Those refunds concern taxable persons, not players, and the national court applies the rule.

What the court decided

The First Chamber gave judgment on 12 September 2024, the same day as Casino de Spa. The operative part has three points.

• Article 135(1)(i) of the VAT Directive does not preclude legislation that exempts lottery tickets and offline gambling while taxing online games of chance other than lotteries, provided the objective differences are liable to have a considerable influence on the average consumer's choice.
• The national court must disapply incompatible provisions, even though the constitutional court maintained their effects.
• VAT collected in breach of the Directive must be refunded unless this unjustly enriches the taxable person.

Why it matters

The ruling sets a test, not a blanket answer. A member state may tax online games differently, but only if the differences between online and offline play are real enough to influence consumer choice.

The refund rule gives operators a route back to money paid under incompatible provisions. Whether a given payment is refundable still depends on the national court. Readers asking how tax rules treat winnings or settlements can check whether gambling settlement payments are taxable.

Questions people ask

Is VAT on online casino games lawful in the EU?

The Court held that exempting offline gambling and lotteries while taxing online games does not conflict with Article 135(1)(i), if the differences are liable to influence the average consumer's choice.

Who decides whether the differences are large enough?

The national court applies the test to the facts. The CJEU supplied the criterion, not the result.

Can operators recover VAT already paid?

VAT collected in breach of the Directive must be refunded, unless this unjustly enriches the taxable person.

Related cases

• C-741/22 Casino de Spa SA and Others v État belge (GL-EU-0210): decided the same day, 12 September 2024.
• Grondwettelijk Hof 34/2018, 22 March 2018 (GL-BE-0003): the Belgian Constitutional Court ruling on the 2016 programme law on VAT on online gambling.