United Kingdom Will Introduce Place of Consumption Tax on Online Gambling
January 29th, 2013 by Site Admin
The UK Department of Culture, Media and Sport is looking to crackdown on a loophole in the 2005 Gambling Act. Under the existing legislation, online poker providers have been able to avoid taxes by moving their servers to other countries. Many providers relocated to avoid paying these taxes.
The United Kingdom’s Parliamentary Select Committee passed a new bill last month that amends the 2005 Gambling Act. That act was designed to close loopholes that allow companies to avoid paying certain taxes by leaving the country. This new bill will have a significant impact on people playing online poker.
Many online gaming providers have been lobbying keep this bill from being passed. However, some companies based in the United Kingdom may benefit from the bill.
Bet365 has been based in the United Kingdom since it was founded in 2000. The company has been paying a consumption tax on all gross revenues derived from UK citizens. Bet365 will no longer be at a competitive disadvantage to other firms providing online gaming to UK citizens.
The new law will stipulate that all online gaming companies offering online poker to UK citizens will have to pay a 15% tax on all gross revenues. This “place of consumption tax” is expected to be introduced in December of 2014. However, lawmakers have not shared all details of the new law.
Reporters from Pokerfuse tried to interview Treasury officials. They declined to answer any questions. However, they have stated that they are committed to working with online gaming providers in the future. They will be giving them input on what changes they will need to make to ensure they are complying with the new law.
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