The UK´s largest online gaming companies that run sports betting, poker and casinos are investigating whether to move their sports book businesses offshore where tax rates are lower than at home. Gibraltar, Malta and the Isle of Man should all benefit.
UK plc gave the sports books big tax concessions 8 years ago in a handshake deal in which major gaming companies promised to head home with their online businesses and pay (albeit lower) UK taxes on revenues.
But that was in 2001- and this is now. William Hill has recently stated that it is to move its sportsbook to The Rock. Ladbrokes is sure to follow given the competitiveness of the industry.
UK betting tax stands at 15% of gross profits, so there are considerable savings to be made. If one company goes, they will be able to undercut the competition and give better odds- so the move is likely to start a domino effect.
Betfair is expected to dampen speculation about a similar move as it is considering a float on the markets of up to 1 billion pounds. It may be forced into it however.
William Hill CEO Ralph Topping stated that it was all down to the success of the Internet in the industry. William Hill’s telephone betting has suffered at the hands of the competetion offshore and it was not something that Hills wants to repeat with its online activities.
Hills have just announced double-digit growth on its touch-screen roulette machines in betting shops. Roulette machines were legalised by the 2001 Treasury pact and have handed bumper payouts over 8 years to William Hill and Ladbrokes in particular. For the first half of the year the roulette touchscreen machines made up over 40% of William Hill’s betting shop gross win — over £150m.
