In the Budget 2012 given by the Chancellor in March it was announced that the government would move to taxing remote gambling on a place of consumption basis. This announcement came after the completion of the Treasury’s review of the taxation of remote gambling in autumn 2011.
The consultation into the issue opened on 5 April 2012. It will close on 28 June 2012.
Details of the consultation can be found here:
In the foreword to the consultation Chloe Smith, Economic Secretary to the Treasury states:
“The popularity of remote gambling has grown and continues to grow significantly. However, despite the UK’s sizeable market, strong history of being a leader in gambling provision, and highly reputable regulatory environment, gambling operators face strong incentives to supply to the UK from outside the UK duty regime. Today, only approximately 10 per cent of remote gambling carried out by customers in the UK is subject to UK gambling duties. In addition, an increasing number of other European countries have moved to taxing remote gambling on a place of consumption basis. These developments mean that the current remote gambling taxation regime is no longer appropriate and requires modernisation.
At Budget 2012, the Government announced that it would move to taxing remote gambling on a place of consumption basis. This announcement followed the Treasury’s review of the taxation of remote gambling in autumn 2011. Under a place of consumption basis of taxation, an operator will pay tax on gross gambling profits generated from customers in the UK, no matter where in the world the operator itself is located.
A place of consumption basis of taxation for remote gambling will level the playing field, providing a fairer basis for competition between remote gambling supplied from the UK and overseas.
The reformed remote gambling tax regime will also improve the sustainability of the UK’s tax base by ensuring that remote gambling, alongside other gambling products, makes a fair contribution to public finances. A place of consumption basis of taxation will bring additional public revenues from operators based abroad who supply remote gambling to the UK.”