Gambling Companies to be Hit with Huge Tax Bills

Gambling Companies to be Hit with Huge Tax Bills

New plans announced by the Government will see those gambling companies who choose to operate offshore hit with hefty tax bills. Under the new plans, those companies who offer their services to UK customers will be taxed, irrespective of where they are based worldwide. Furthermore, those companies who try to hide will face the risk of criminal prosecution, prison terms of up to 7 years and large fines.

Online and Offline

The news is likely to hit the online and offline specialists equally hard. Whilst high street bookmakers such as Ladbrokes and Coral have a very real presence in the UK, their online counterparts are based in offshore tax havens.

International companies trying to escape taxation has formed a large part of the news recently with huge conglomerations such as Starbucks and Amazon all being criticised for their position in tax avoidance.

However, consumer opinion has shown that those companies with poor tax records not only receive poor consideration by their customers but also reduced their profits as customers demonstrated their distain by shopping with rivals.

The New Rules

Starting from 2014, any betting firm which takes money from UK punters, either online, in person or on the telephone will be liable to pay tax for those customers. Depending on the service they offer, they will need to pay either remote gaming duty, general betting duty or pool betting duty, all of which are currently taxed at 15%.

In an industry which is worth an estimated £2bn every year and with the number of web users that know how to bet on the rise, it is thought that the new rules could gain the treasury up to £300m annually.