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WARNING ON UK INTERNET GAMBLING SECONDARY LICENSING AND TAX

01/03/2012 : Independent survey says online gambling tax plans may drive punters to unregulated sites.
 
With momentum in the UK building for a 'secondary licensing' regime and taxes, the William Hill gambling group has gone on the offensive as the new year starts, again drawing attention to an independent survey it commissioned.
 
The study, conducted by respected international professional services group Deloitte, found that the British government's proposals for a point of consumption tax on online gambling could backfire, with punters driven to unregulated sites, and smaller operators forced out of the market.
 
Deloitte concluded that levying such a tax at 10 percent would seriously hurt the government’s “consumer protection policy objectives”. It additionally found that as much as 27 percent of current revenues would disappear into the “grey”, or unregulated, market. And at 15 percent tax, that figure rises to 40 percent.
 
The survey found that the most marginal operators, accounting for up to 13 percent of UK online bets, could be “expected to exit following the introduction of a 5 percent tax”.  That would not only push more UK punters into the unregulated market, but there would also be a knock-on effect on gambling companies’ revenues and marketing spend, hitting both corporation taxes and sports sponsorship.
 
William Hill has submitted the report to the Treasury, which is reviewing a possible new tax regime for remote gambling.
 
The Telegraph newspaper, reporting on the Deloitte study, says that UK consumers currently spend about GBP 1.7 billion a year – roughly 18 percent of total UK gambling revenues – with online gambling companies. At present many companies - including William Hill plc - escape the 15 percent gross profits tax levied in the UK by locating their internet operations in tax havens like Gibraltar, Malta, Alderney and the Isle of Man.
 
The new proposal would see any operator wishing to access the UK market being required to take out UK licensing and pay an as yet unquantified UK tax rate, on grounds that online gambling takes place at the point of consumption i.e. the player's hardware.
 
Deloitte points to the US, France and Italy in illustrating that attempts to control online gambling have “failed to prevent the emergence of a large unregulated sector”, not least because of the difficulties of introducing enforcement mechanisms such as blocking internet service providers or types of financial transactions.
 
Ralph Topping, chief executive at William Hill, told the Telegraph: “Money will always find a way out. More people will go overseas or to fly-by-night, unregulated sites where the consumer is not protected. I hope the Government sees sense on this.”
 
Assuming “ineffective enforcement”, Deloitte finds that a 15 percent tax rate would bring in incremental tax of GBP 116 million after adjusting for a GBP 57 million fall to GBP 76 million in corporation tax. That would be at the price, however, of exposing many more consumers to unregulated, and possibly unsafe, gambling sites.
 
A Treasury spokesman said: “Responses to the review are in and are being analysed.”



Gambling News :

Bet365 betCall product alleged to be circumventing local betting law - The Interactive Gambling Act 2001 prohibits the placing of bets on events that have started except via telephone," the newspaper explains, observing that the three UK-headquartered companies get around this requirement by only accepting bets if punters have their computer microphones turned on.

Romania Blacklists 50 Online Gambling Websites - Oficiul National pentru Jocuri de Noroc (ONJN), the Romanian gambling authority, has announced the publication of a blacklist identifying 48 websites that have accessed Romanian online punters without the necessary licensing and have consequently been banned.

2015 WSOP Little One for Big Drop event - Continuing the best traditions of talented young German players, 24-year-old Leipzig student and part time player Paul Hofer bested a field of 4,554 other players to win the $1,111 buy-in Little One for Big Drop event at the World Series of Poker Friday night.

2015 WSOP Event 63 - Also competing on his ninth final WSOP table was Don Zewin, who has been playing at the World Series for the last three decades but is still hunting a bracelet.

Paddy Power's guerilla marketing tactics paid off - Tongue in cheek, the gambling company picked up on the strong opinions around a sensitive subject, and generated a promotion designed to attract attention and publicity.

Aussie Betting Firms Deny Illegal In Play Betting Offers - Media reports in Australia that the federal police are enquiring into the legality of William Hill and Ladbrokes in-play betting offers have been rejected by the Australian divisions of the two companies.

Hot as Hades Slot Launches - The new game is a 5 x 3 reel, 20 line slot, with a tongue-in-cheek theme based on Greek mythology. Hades, with his flaming hair and cheeky grin, takes centre stage as he embarks on an adventure to Mount Olympus with his three-headed sidekick, Cerberus.

Optimal Payments has provided a trading update - Online payments group Optimal Payments has provided a trading update covering the six months period to 30 June 2015 ahead of reporting its interim results on 26 August 2015.

2015 WSOP Event 59 - Alex Lindop, a 25-year-old professional player from Stoke-on-Trent, has claimed the UK's second bracelet in this year's World Series of Poker, besting a talented field of 2,154 other players and claiming the $531,037 winner's share of the $2.9 million prize pool.

Pokerstars Launches Let California Play Poker Drive - Pokerstars and its California tribal and cardroom allies have upped the ante in the fight for fair and open online poker legalisation in the Bear State by launching a new Professional Player Tour initiative titled Let California Play!

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