Monday July 30,2012 : WILL HILL TO CHALLENGE PROPOSED NEW UK INTERNET GAMBLING LAW (Update)
Lawyers briefed to prepare a legal case against point of consumption taxation
Britain's largest bookmaking firm, William Hill plc, has briefed lawyers to prepare a challenge to the proposed new UK law that will see offshore companies accessing the British market taxed on a ‘point of consumption' basis, and forced to take out secondary licensing with the Gambling Commission.
Reporting on the new development Monday, the Telegraph newspaper said that the bookie giant was less than pleased at the prospect of a 15 percent on profits, due to come into force around the end 2014.
In the highly competitive remote gaming market, almost all major UK bookmakers, including Ladbrokes, have shifted their online businesses to gambling-friendly tax havens such as Gibraltar and the Isle of Man over the past decade in order to better compete against other offshore online gambling operators.
Betting lawyers have already warned that the proposed tax is “illegal” under European Union law as it is an attempt to restrict the free movement of goods and services for tax purposes.
Ralph Topping, chief executive of William Hill, told The Telegraph that he had received “encouraging noises” from lawyers that the betting giant would have a solid case against the ‘point of consumption' tax. William Hill’s digital profits reached GBP 68.9 million in the first half of the year, and the channel is an important component in the group.
Jason Chess, betting and gaming partner at law firm Wiggin, said: “You cannot restrict the free movement of goods and services in order to raise your own national tax. We can’t stop BMW from selling BMWs in this country because the tax is paid in Germany.”
Betting authorities in Gibraltar are also considering taking the UK to court over the tax amid fears it could encourage bookies to shift their online businesses back to Britain.