Foreign UK Casinos Taxed

The British media reported that the government intends to regulate and tax foreign based internet casinos that offer their services to UK punters.

Many British-based sites are angry because gambling sites based in other European countries pay less tax as opposed that in Britain.

Many of the UK’s top sites like Ladbrokes and William Hill formerly licensed in the United Kingdom, established offices in more favourable jurisdictions which means less tax revenue to the Treasury.

The minister for tourism and heritage for the Department of Culture, Media and Sport, John Penrose said that the legislation would be tabled in parliament. It stipulates that foreign based operators will be issued with a secondary license where they must pay a license fee.

The specifics of the license fees were not disclosed in the publication. In future foreign based operators will fall in a different tax bracket. The British government intends to stop foreign based operators from advertising if they don’t have a license. Taking into account the obligatory secondary license, maybe this restriction won’t be necessary.

The Remote Gaming Association (RGA), an organization that looks after the interest of foreign based operaors reacted first to this announcement. RGA’s chief executive Clive Hawkswood had the following to say, “Since the government made its intentions clear, it’s our aim to play a productive role in the process to ensure that the new regulatory and tax regime will foster an environment where Government objectives are attainable, where the industry can succeed commercially within the global internet gambling arena, and where player interest comes first.”

Hawkswood acknowledged the fact that the majority of operators that service UK punters are based abroad. He also mentioned that they adhere to stringent standards akin to those in Britain. As it stands, the issue is not about regulation but taxation. Should a higher tax level be introduced it might have a negative impact on the British punter and further erode commercial practicality.

It is imperative that the new regulatory regime must be unbiased and sustainable. Hawkswood concluded, “We look forward forging a close-knit working relationship with DCMS, HM Treasury, and the Gambling Commission ensuring that all gambling related matters are addressed in a timely and professional manner.”