UK Plans to Tax Remote Gambling Confirmed

Implementation will take some time, though

This week, British Chancellor George Osborne confirmed in his budget speech that online gambling is defined as taking place at the point of consumption, and that offshore operators accessing the British market can expect secondary licensing and taxation. This move is observed by many as Osborne’s plan to bring major UK online gambling companies back to British shores.

In addition, the Chancellor specified that he would be introducing double taxation relief for remote gambling from next month.

“Ninety per cent of online gambling consumed by our citizens is now supplied from outside the UK. And the remaining UK operations are under pressure to leave. This is clearly not fair – and not a sensible way to support jobs in Britain,” he said, adding that the change would help create “a more level playing-field and protect jobs.”

However, the industry observers noted that implementation may take two or more years, as treasury budget documents estimate that the impact of the change will be extra tax revenues of GBP 55 million in 2014-15; GBP 240 million in 2015-16 and GBP 270 million in 2016-17.

According to the Treasury document, "The current taxation regime for remote gambling has allowed operators to avoid paying UK gambling duties by basing their operations abroad. To broaden the tax base and provide a fairer basis for competition between UK and overseas remote gambling operators, Budget 2012 announces that the Government will move to a tax regime that ensures operators anywhere in the world pay gambling duties on gross profits generated from customers based in the UK. This is in line with the actions of several other European countries.

"2.146 Remote gambling taxation – The Government will introduce a consumption based taxation regime for remote gambling, subject to consultation on the detail.”

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