London is starting to understand that it was bad idea to tax too highly
The UK government seems to have recognized its mistake on online gambling legislation, with reports that is planning to make a u-turn on taxation of Internet casino, betting, poker and bingo operators.
Change of heart?
The Treasury is apparently ready to slash a 15 percent tax on all gambling services in the UK, according to a report from the Mail on Sunday. It speculated that the tax could be reduced by as much as a third, in an effort to reap back some of the more than £2 billion in revenues lost over the past seven years.
According to the Gambling Commission, the body responsible for overseeing online gambling within the UK, online gambling was worth an impressive £20.1 billion to the 12 months ending March 2012, and is growing at an annual rate of 15% throughout the European Union.
Bringing them back
The UK has hard work cut out for it if it wants to attract back the biggest gaming operators. Seven years ago most UK online gambling firms moved to offshore tax havens like Malta, Gibraltar and the Channel Islands in order to avoid the then fresh 15% tax imposed on all gambling services by the state.
A reduction in the tax rate would go a long way to bringing them back, but many industry insiders believe the government will have to ogo further than reducing it by a third, as 10% still means these companies will pay far more in taxes than they do in their current homes abroad.
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