Online Gambling Tax Debate Continues in the United Kingdom

03/29/2012
By Tommie ClarkGoogle

A proposal that would make it compulsory for offshore online gambling operators to acquire secondary licenses and pay taxes in the UK is being debated by the British authorities. The debate comes after the revelation that the government has been losing about £300 million in revenue a year from gaming.

 

Gala Coral and Bet365 are the only two top online casino operators to remain onshore. Carl Leaver, CEO of Gala Coral, stated that onshore betting taxes are squandering profits and do not provide a competitive advantage. Leaver hopes for equalization of onshore and offshore taxation.

 

Ciaran O'Brien, corporate affairs director for Ladbrokes, an online casino games operator that has moved offshore stated, "We are working harder for the government than we are for ourselves." He made the case that high tax rates would eventually bring in unlicensed sites. O'Brien advocated a reasonably low rate of online gambling tax to be collected at the point of consumption.

 

Recently, Tory MP Matt Hancock, proposed a bill that would tax companies based on the location of the online casino games player and not the location of the online casino. This would remove any issues relating to onshore versus offshore gaming.  According to the bill, any company that does not follow the fall will have their advertising suspended in the UK as well as prosecution of operators entering the country. The regulatory body of online casino games in the UK, The Department for Culture Media and Sport, would like the bill to move forward. They may face up to a two-year waiting period based on the other items on the government’s agenda. It has been said that because of the prolonged process, if MP Hancock's bill reaches the committee stage, the ministry will likely support it with minor changes.

 

 

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