Point of Consumption Tax for UK Operators Kicks InPublished December 3, 2014 by Amir G
New UK gambling regulations charge a 15% place of consumption tax on all gambling operators which cater to UK players.
The new regulations for gambling operators catering to UK players have come into force on Monday, December 1. Under the new rules, any operator which offers remote gambling to UK citizens regardless of its location is required to receive a license from the UK Gambling Commission and to pay a 15% place of consumption tax.
The new regulations which form part of the Gambling Act of 2014 were originally scheduled to come into force on October 1, but were delayed until December 1 after a legal challenge by the Gibraltar Betting and Gambling Association which called the act "unlawful" was dismissed by Judge Nicholas Green.
Change Intended to Balance Competition
UK lawmakers have explained the new regulations as means intended to level the competition between UK-based gambling operators and offshore operators which were not subject to any UK taxes up until now. Exchequer Secretary to the UK treasury Priti Patel said: "The Government has created a level playing field across the gambling industry so that all gambling by UK consumers is now subject to UK tax."
Aside for the competition, online gambling is a fast growing industry worth billions of dollars, and the UK wants a bigger slice. Under the new taxes, the UK treasury is predicted to collect an estimated sum of £300m.
Predicted Impact of New Regulations
The new regulations could hit smaller operators due to decreased profit margins, and marketing budgets could be hurt. However the government could alter the regulations if the impact is too strong as the UK gambling market is a very important asset.
The rules have already taken their toll on UK operators and players in the past two months as major online casinos the likes of All Slots Casino, Jackpot City Casino and Gaming Club Casino have stopped accepting UK players altogether.