UK Remote Gambling Duty

Richas · #1 03-21-2007, 11:50 AM

This has been set today at 15% of gross profit. This was the highest it was likely to be set at - it matches the current bookmakers levy.

We will have to see which, if any, sites take up the offer to come onshore at this price. For it they get the ability to advertise in the UK(and EU) plus UK support in the EU and at the WTO. If current sites don't get a licence expect newcomers to do so (harrahs?) as then they can market without opposition from the current players.

LeapFrog · #2 03-21-2007, 01:01 PM

Thanks for keeping us informed Richas.

Phil123 · #3 03-21-2007, 01:43 PM

I can't see any sites taking up a UK licence if they have to lose 15% of their profit.

Richas · #4 03-21-2007, 01:51 PM

[ QUOTE ]
I can't see any sites taking up a UK licence if they have to lose 15% of their profit.

[/ QUOTE ]

Yeah it is a big barrier to existing sites but the advertising restrictions have teeth and mean that a new entrant can still keep 85% of the total profit whilst writing off the startup and marketing costs. I guess the question is can the ability to advertise and the quality mark of UK regulation grow the business by more than 15%?

NoMeansYes_ · #5 03-21-2007, 03:34 PM

Moving to the UK, would poker sites have support allowing USA players seeing as how the US law violates the WTO agreements? If yes, ROBUSTO

JPFisher55 · #6 03-21-2007, 04:10 PM

I doubt that many online gambling sites will pay this tax. My guess is that they will continue to operate as they currently do and the UK will not ban their citizens from playing on them. I guess that they won't be able to advertise in UK. But I doubt that many will pay 15% to advertise in UK.

Skallagrim · #7 03-21-2007, 04:18 PM

This is an interesting development...Didn't Party already say they would come to the UK? That was before the 15% was announced tho, and Im not sure.

I can see the bigger non-US player sites taking this chance only because it would give them the real possibility of being allowed to be legal and legally advertised throughout the EU (which is simultaneously working to end individual member states gambling monopolies).

I cant see the sites that are making most of their money from US players remotely considering this - they might have to stop taking US players if they did, and any benefit from the UK taking the issue to the WTO (joining Antigua) would, unlike the EU commission, be years off, and still maybe unsucessful (in the sense that the US would probably ignore it).

But this will be intersting to watch.

ianlippert · #8 03-21-2007, 05:15 PM

Do sites pay any taxes right now? If not 15% seems lower than most corporate taxation.

mbpoker · #9 03-21-2007, 06:06 PM

It's 15% on the revenue, not on profit. Depending on the margin and ont the current tax rates it can be as high as 30% on profit.

Sites like Party and Stars will be able to advertise in UK even without being licensed there because Gibraltar and IOM will be on the white list.

Skallagrim · #10 03-21-2007, 06:15 PM

"Sites like Party and Stars will be able to advertise in UK even without being licensed there because Gibraltar and IOM will be on the white list. "

This certainly makes a big difference, and now the only reason(s) I can see ANY site going to the UK under this act is 1) the unlikely fact that they pay higher tax wherever they are now and 2) the somewhat speculative prosepect of being able to recoup this money through expanded EU advertising - and you EU folks will have to help me here, do the Isle of Mann and Gibralter already have a status within the EU and so sites there could do this anyway if the EU stops state monopolies?