UK Government to impose 15% tax increase on off-shore gaming companies
Posted: 22nd October 2014 09:07
Online gaming companies who have a UK based customer field but are based off-shore are set to face an increase in tax, with a new levy coming into fruition from December. As it currently stands, gaming companies’ taxes are based on where they are geographically registered, rather than the location of their customer base, but this new legislation drawn together by the government is set to change how these are calculated.
The levy was first outlined in the 2012 budget announcement with the change in law expected to bring in around £300m extra in taxes per year from the off-shore operators. Increasing the tax percentage to 15% also draws the firms back level to the rate at which the domestically based gaming and betting firms are currently being charged.
Gibraltar is one of the tax havens where gaming companies are registering, as the percentage they have to pay out is capped at 1%. Many of the major names within the industry have been working out of the British Oversea Territory for the last 15 years, and have had no issues with their consumer based being UK citizens.
Although The Gibraltar Betting and Gaming Association (GBGA) has voiced its concern over the levy, the law may force many of the companies to leave the GBGA and move operations back to the British soil, to avoid having to be involved with 2 different governing regulators
With the law set to come into play on 1st December, it will effect companies from all corners of the gaming industry. The rise in online casinos and mobile casinos such as http://www.gamingclub.com/au/mobile-casino has been significant in recent years, with more gamers choosing to play the likes of poker and blackjack on the go, rather than in actual land based casinos. Similar trends can be seen in the sports gambling market, with bookmakers offering apps for their customers to place bets.