Black Market Betting Could Increase Over Taxation

Black Market betting could be encouraged by High ‘Point of Consumption’ Tax on Online Gambling, say MPs

Government proposed new gambling license laws regulating UK gambling on placed bets that are being backed by the Culture, Media and Sport Committee could create new online markets that are illegal if taxes are too high.  The Committee has been reported to say that they see the Government’s main reasoning for moving to a licensing operation system is based on the point of consumption where the current system has great weakness in providing information, consistency and being transparent.  The main motivation of the legislation is not to bring UK operating servers to the new tax net but merely a legislation consequence.

Bookmakers are already moving their operations overseas to dodge this UK tax on their profits.  Great Britain allows overseas companies to operate and given a ‘White Listed’ jurisdiction gambling license if they are known for socially-responsible gambling.  The Committee has stated that remote gambling from overseas operators has declined the Government’s POC regulation plan that was published in December 2012 by the Department for Culture, Media and Sport.

The Committee’s report states that the operators that have moved their gambling operations overseas believe the tax plan to be not necessary for protection of the consumers, might push those consumers to unlicensed operators that are cheaper and are intending to push overseas operators into the new UK tax plan.  The Government insists the motivation for the new tax net proposal was not to push overseas operators into it.  However, Hugh Robertson, the minister for sport and tourism has stated that the new tax proposal would create a bridge over the regulatory gap that currently resides in protection for consumers and efforts in anti-corruption.  The Committee welcomes overseas gambling operators to display a logo or “kitemark” on their web sites to show that they are Gambling Commission License holders under the new framework proposal.  The kitemark system was suggested to be released last year.

May 5, 2013 by : posted in Gambling News No Comments