The value of bets placed via UK-regulated and taxed channels rose by a huge 17% last year, new government figures show.
British punters staked fixed-odds and pool bets worth £32.9bn in the 2012/13 financial year, 17% up on the £28.2bn recorded a year earlier, netting HMRC £384.6m in tax revenues.
These figures of course did not include most online bets placed in Great Britain, given the overwhelming amount of activity currently takes place on websites regulated overseas, estimated by H2 Gambling Capital to represent more than 60% of the £2bn UK remote betting and gaming market.
The impact of William Hill, Ladbrokes and Betfair moving their online operations to Gibraltar since 2009 was reflected in the 2012/13 figure, while 17% up on the prior year, being substantially below the £37.4bn in stakes recorded in 2010/11.
Last year’s performance however saw the UK taxman reap total receipts of close to £1.68bn in betting and gaming duties from the British-regulated industry, with the overwhelming slice of this - £830m – coming from the National Lottery.
The remainder was made up of the aforementioned betting duty, as well as all forms of gaming in Great Britain coming under the remit of the UK government, including machines and bingo.
The UK government expects to increase its tax receipts from the British online gambling industry from 2014/15, when remote operators will be required to obtain a licence from the Gambling Commission in order to continue targeting British consumers and advertising in the UK.
Based on H2’s estimates of a UK onshore and offshore-regulated remote industry worth £2.064bn in gross gaming yield in 2012, the shift of the tax model to one based on location of gambler, rather than company, could reap the UK government up to an extra £309.6m in annual tax revenues, based on on an assumption of the current 15% gross profit tax. However, around 5% of the existing market is widely expected to avoid being regulated and taxed in the UK, lowering the likely tax take to nearer £294m.
Both the Gambling Commission and the Department for Media Culture and Sport have stated the new licensing regime and accompanying place-of-consumption tax could be in place as early as April 2014, eight months ahead of the originally planned implementation date of December 2014.
Article written by Peter Holmes
