A New Licensing Framework Offered by UK Think Tank Social Market Foundation

The UK's non-partisan think tank Social Market Foundation (SMF) has offered a detailed new framework for gambling regulation.

Some New Recommendations

New recommendations in the world's largest market include stiffer taxes on offshore gambling operators and spending limits set at £100-a-month per user to protect against financial harm from problem gambling behavior.

Offshore Measures

Other sweeping measures the report calls for include increasing operating costs for firms based in the Isle of Man or Gibraltar and tax benefits including reductions for companies that bring their operations to Britain.

Incentive-based Taxation System

The SMF released a statement in favor of an incentive-based system taxation for gambling commensurate to a company's UK presence, saying that the decision for operators “to base their headquarters in locations like Gibraltar, the Isle of Man or Alderney” would “carry significant tax implications.”

Government Changes Pending

The amendments are proposed ahead of an impending Government review of the 2005 Gambling Act which ministers are seeking to revamp to meet the needs of the new online gaming era.

BGC Resists

UK operator trade association Betting & Gaming Council (BGC) came out against the plan, asserting its members already conduct affordability checks in many cases.

The BGC further asserted that in order to prevent loss of jobs or increases in taxes currently approaching £3bn, any new tax measures must be proportionate and evidence-based:

“We disagree with the suggestion of an arbitrary and random low cap on spending and can think of no other area of the economy where the government determines how much an individual can spend.”

White Labeling Challenged

The SMF further called conclusion of popular “white label” agreements enabling foreign firms to buy access to the British market via an existing gambling licence holder.

The SMF believes that white label customers have far less incentive to protect the local market, and that the white label removal would increase jobs and compliance among UK licencees to protect the vulnerable and the addicted.

UK Government Plans

The UK government has committed to reviewing the laws, with adaptions on the table to promote good behaviour and increase scrutiny and oversight of the sector.

Outlook

Whatever the final results are, look for a huge shakeup across the UK gambling industry in the coming months.