Bookmakers issue job loss warning to UK government

Representives from the leading UK bookmakers William Hill and Ladbrokes have issued a warning to the Chancellor that any attempt to increase taxes and regulations in the April budget will lead to job losses and shop closures amid fears that the government is considering a raise of gross profits tax from 15pc to 17pc.

An industry insider said “Analysis by London Economics indicates that an increase in GPT from 15pc to 17pc would result in the closure of 845 betting shops and see the loss of 3,190 full time jobs,”. The gaming industry currently employs 40,000 people and operates over 8500 shops.

They have also indicated that an increase in taxes would see UK based operators relocate certain aspects of their business to offshore locations such as the Isle of Man and Gibraltar where taxes are set at around the 1pc mark.

The UK gaming industry currently contributes at least £1 billion in national and local taxes. This is on top of levies paid to the horse and greyhound industries which are thought to be in the region of £130 million per year.

Gibraltar wins tax case against European Commission

The British overseas territory of Gibraltar has won its appeal against an earlier ruling the European Commission after a period of four years and will now be allowed to carry on charging much lower rates of corporate tax than the United Kingdom that has allowed companies to benefit enormously.

Gibraltar is currently the base for many leading gambling operations including PartyGaming, 888 Holdings and Carmen Media who amongst others employ around just over ten percent of the populations 28,800 citizens Peter Caruana, Chief Minister of Gibraltar, went on record that if the case had been lost, it would have resulted “in the bulk, if not all, of the finance centre and gambling companies leaving Gibraltar” with “the loss of thousands of jobs throughout our economy.”

No tax increase on Irish online gambling

The Irish Government has confirmed this week that is has no plans to tax bookmakers operating over the telephone or online because it needs to spend more time researching the industry. Brian Lenihan the Irish minister for Finance declared that the tax on land based bookmakers was to doubled to two per cent on turnover from the beginning of next year, but online and telephone service will remain tax-free

Previous attempts to tax the online betting industry by the Irish Government have failed as many of them mover their operation to Gibraltar and other tax havens. The government however has stated that it does wish to force some type of tax onto the sector in the future.