Offshore online gambling firms will pay new UK tax

Tax Blow for Offshore Casinos: The U.K. government has announced plans to levy approximately a half-billion dollars/year in tax revenues from online gambling companies currently operating in tax havens off its shores, while offering services to U.K. customers. HM Treasury’s newly released discussion paper outlines the concept for new rules governing the taxation of revenues earned by international online gambling operators, shifting the focus to the "place of consumption" (i.e., where the physical gambling takes place) and not the "place of production," so that even companies based outside of the UK will be liable to pay taxes on profits garnered in the United Kingdom

If the move goes forward, companies including Ladbrokes, Bwin.party, William Hill, and Betfair, which currently all have online operations based in Gibraltar where taxes are levied at 1% and capped at £425,000, would taxed at the rate of 15% on U.K.-based profit; William Hill, the leader in the the U.K.’s remote-gambling market, has previously indicated that it could challenge the changes on the grounds that they breach European Union competition law.

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