| 02 September 2007
So the forces of darkness have won. With a fanfare, the UK government has brought
into force its supposedly 'liberal' gaming legislation.
The reality is that the Act creates yet another army of officials with draconian
powers to levy unlimited fines, withdraw licences, bring prosecutions, enter
premises, seize goods and suspend and void bets.
And as regards tax on gaming, it will go up in all directions. True, the government
won't be collecting more revenue from on-line gaming operators, but that's only
because Gordon Brown's Calvinist streak has ensured that the remote gaming duty
is set so high (at 15% of gross profits) that native on-line operators will
become rarer than Lesser Speckled Hackney Marsh Owls.
15% of gross profits means anywhere from 30% of net profits upwards, and that's
before corporation tax or any of the other taxes British businesses get to enjoy.
The winners in all this may be the gaming operators in Gibraltar, the Isle
of Man, Alderney and Malta, who can apparently advertise in and provide gaming
services to UK residents without needing to have a UK license or pay the remote
gaming duty.
I say 'apparently', because the wording of the Act could be constructed so
as to allow the gaming duty to be applied to their UK turnover; and there are
issues over VAT on services provided within the EU which could catch operators
who don't register in the UK and benefit from VAT exemption.
As with financial services, for the majority of operators who are based outside
the charmed circle of the UK and its dependencies, there are major uncertainties
over what constitutes the provision of remote gaming in the UK, and the Gambling
Commission will no doubt be just as energetic as the FSA in working for as wide
a definition as possible.
If you own a gaming business, just make sure you stay away in future. The UK
doesn't want you (but will take your profits and put you in gaol if it can!)
You have been reading an entry on the following blog:
Jeremy Hetherington-Gore Unleashed
Jeremy tackles the difficult issues head on!
Contact: jeremy@lowtax.net
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