Virtual Gaming Worlds to charge sales tax on sweepstakes platforms

Sweepstakes operator Virtual Gaming Worlds (VGW) has confirmed a recent change to its platforms that will mean players must now pay sales tax on all gold coin purchases.  

Following this update to the operator’s terms and conditions, all players now must pay user sales tax on the Chumba Casino, Global Poker and Luckyland Slots platforms. Reports suggest that the implementation of this new rule comes following a push to remain compliant in the US market by VGW – amidst a wave of recent legislative scrutiny against sweepstakes in the nation.  

Now, players wishing to purchase the gold coins necessary to engage with the sweepstakes casino games on the site(s) must also pay the applicable sales tax for the purchase of said coins. 

Speaking to Gaming America on this new system, a VGW spokesperson said, “Sales tax is common in the US and helps state governments raise revenue, but differs across the country. Some states don’t have sales tax, while in other states that do, the tax rates can vary. Local governments may also have additional taxes. As such, the total rate paid by players following this decision is dependent on their location.  

“We acknowledge this is a change for some of our players, but as the legal framework has evolved over time, we’ve determined it is the appropriate time to take this action. This is part of our commitment to upholding the highest standards of integrity and compliance, and our focus now is on ensuring players are well informed and supported as required.”   

Good to know: Earlier this month, daily fantasy sports (DFS) were also outlawed in California by the state’s Attorney General  

VGW has been subject to lawsuits in multiple states over recent months, with a recent cease-and-desist letter having been submitted by the Delaware regulator in April, ordering the operator to shut down its Luckyland casino platform operations in the state.  

More recently, in May, VGW announced it would be withdrawing its sweepstakes operations from the New York State market, with its free-to-play games still available to access for residents.  

Will Underwood

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