The Swedish gambling tax has been partly blamed for the disappointing financial results of AB Trav och Galopp (ATG), the premier betting operator in Sweden for horse racing.
The company reported that net gaming revenue fell by 2% from SEK 2.346 billion (€202 million) to SEK 2.099 billion (€181 million). Performance also declined across its business, according to the company.
ATG taking decline in numbers “seriously”, says chief financial officer
The numbers represent an undoubted blow to the company and the sport of horse racing, which heavily depends on the betting industry to thrive.
The sport relies on revenue from ATG, the country’s dominant betting operator, which channels much of its surplus back into prize money, racecourse operations and breeding programs. Without that wagering income, the sport’s funding model, from purses to rural employment, would face significant strain.
Chief financial officer and deputy chief executive, Lotta Nilsson, attributed the issues facing the company and the sport of horse racing to the increased tax burden and outlined the damage it could do to a key pillar to its business.
In a statement, Nilsson said: “Both the lower revenues and the increased gambling tax hit the return to our owners directly and thus weaken the financing of the horse racing sector.”
ATG has long argued that horse racing should not be treated the same as casino gambling. Departing CEO of ATG, Hasse Lord Skarplöth, said in December last year: “Not all forms of gambling are equal. Online casinos are a decoupled digital product. Horse betting is not,
“It is closely intertwined with a national horse industry that encompasses around 350,000 horses and provides employment for nearly 40,000 people. Without the horse industry, not just a game disappears, but also jobs and regional structures.”
CEO Skarplöth to step down
The disappointing financial results come as ATG confirms its CEO Skarplöth is to step down after 13 years at the helm.
In a statement, the company said differing views between the board and Skarplöth was the main reason behind the parting of ways.
ATG Chair, Peter Norman, spoke glowingly of Skarplöth’s contribution to ATG. He said: “Hasse Lord Skarplöth has been CEO of ATG for over 13 years. During this time, ATG has developed into a professional gaming company that rests on three pillars in horse betting, sports betting and casino.
“Hasse has run the company in an exemplary manner that has also included international expansion. The board would like to thank Hasse for his great contributions to ATG over the years and wishes him all the best in the future.”
Skarplöth added: “I have had the privilege of being CEO of ATG for a long period. It has been a fantastically rewarding time and I have appreciated every day I have gone to work.
“Together with committed and loyal employees, we have had an unprecedented growth journey. I am proud of what we have achieved and of the position the company has today. I wish ATG all the best in the future with all my heart.”
Tax increase continues to fuel illegal gambling concerns
Sweden introduced a gambling tax as part of its re-regulated market on Jan. 1, 2019, setting the rate at 18 percent of gross gaming revenue for licensed operators. However, as part of the 2024 budget, the government approved a tax increase from 18 percent to 22 percent, which took effect on July 1, 2024 amid industry warnings that higher rates could strain licensed operators and push players toward unlicensed sites.
Swedish authorities acknowledge that illegal gambling remains a persistent issue, with the latest regulator data showing that about 15% of gambling activity takes place outside the licensed market, primarily in online casinos where players use unlicensed offshore sites rather than companies regulated by the Swedish Gambling Authority.
According to annual figures from Spelinspektionen, surveys and internet traffic analysis identified more than 2,000 unlicensed websites accessible from Sweden in 2024, and industry estimates suggest that a substantial share of online casino play leaks to these operators, driven by factors such as bonus offers and game variety, even though most licensed gambling still accounts for the majority of play.
Industry experts often warn of the need to protect a thriving, regulated gambling sector in the country. They argue a failure to do so would see an exodus to blackmarket operators.
Last year, Skarplöth said: “It is unreasonable that such a large proportion of gambling still takes place outside the licensing system.
“Unlicensed gambling is a breeding ground for money laundering, but above all, Swedish players are without protection from rogue operators. The annual turnover of unlicensed gambling is almost as much as the entire Swedish primary school costs.”
Question of horse racing funding in Sweden remains pertinent
ATG’s weaker financial performance has sharpened concerns about the long-term sustainability of Sweden’s horse racing model, which remains structurally reliant on betting revenue. With net gaming revenue down and gambling taxes higher, the margin available to redistribute funds back into the sport has narrowed, a development with direct consequences for prize money, race programming and investment in breeding.
Unlike many other sports, Swedish trotting and thoroughbred racing lack substantial broadcast-rights income or large private ownership structures to cushion downturns. Instead, the system depends on ATG’s surplus being funneled back into the industry, supporting everything from racetrack operations to rural employment tied to training yards and stud farms. Any sustained decline in wagering performance therefore reverberates beyond the balance sheet.
The timing is also significant. Leadership transition at ATG, combined with an evolving regulatory environment, leaves open broader questions about whether the current tax framework adequately reflects racing’s funding model or whether continued fiscal pressure could gradually erode one of Sweden’s most established sporting ecosystems.
