The UK could face an exodus of remote gaming operators if the government sets the tax rate too high under the new gambling bill, a leading trade association has warned.
The Association of Remote Gaming Operators (ARGO), whose membership includes all the big UK sportsbooks, said the bill will be “worse than ineffective” in realising its goals.
Its conclusions are drawn from a report it commissioned from consultancy firm Europe Economics.
The report said UK sales tax, or VAT, already imposed an effective 3% tax on gross win, and warned a high rate of gambling tax above this would have disastrous consequences.
“It is unlikely that remote-gaming operators seeking to compete internationally will relocate all their business into Britain,” an ARGO report said.
“Only online betting companies that serve almost exclusively British customers are likely to locate their operations in Britain,” it added.
ARGO’s chairman, Ian Spearing from William Hill, said he hoped the government would heed the warnings in their reports.
“Britain could have the best gambling legislation and regulation in the world, but it will be to no effect if the tax regime acts as a fundamental disincentive,” Spearing said.
The ARGO reports backs up previous warnings over the tax rate from industry trade body iGGBA and Nigel Payne, chief executive of Sportingbet.
However, despite the warnings there is unlikely to be any ruling on the tax rate before the summer.
The government has repeatedly stated it will not make any announcements on the tax rate until after the gambling bill becomes law.
A full copy of the 31-page ARGO report can be found at http://www.argo.org.uk
source : egaming review magazine
