The UK Treasury has been pointed out by industry experts for its lack of understanding of the industry's specificity when formulating gambling tax policies. Stephen Higginett, joint head of CMS tax, stated before the budget announcement that although the Treasury has begun to pay attention to the unique operating modes of the gambling industry, there is still "a long way to go" to truly grasp its complexity.
Gap in Understanding Between the Treasury and the Industry
Higginett pointed out that the Treasury's special committee previously questioned why many British gambling companies set their headquarters in offshore centers such as Gibraltar and Malta, thinking it was to evade corporate income tax. However, he explained that there are profound historical reasons behind this: "Different parts of this industry have their historical origins in being produced offshore or onshore." Frankly, since the era before the Gambling Act of 2007 when remote gambling was illegal, operators have always been seeking a balance between overseas and domestic to ensure fair competition.
Concerns Arising from Tax Reform Proposals
The consultation document launched by the Treasury in April considers merging the current three-tier profit tax system into a single tax rate, which could raise the gambling tax from 15% to 21%. The industry widely opposes this plan, believing it is based on "incorrect assumptions"—that different forms of gambling are simply classified. Higginett emphasized: "If anyone can bear the increased tax, it might not be the ordinary practitioners of the gambling industry." More professional analysis on gambling tax policy can be found on the PASA official website.
Direction and Implementation Schedule of the Policy
Regarding the potential new gambling tax policy, Higginett expects it to take effect from the next fiscal year if announced in the budget. He explained: "For the type of gambling tax we are discussing, the tax rate increase usually takes effect at the start of the next fiscal year." The Treasury had suggested raising taxes on high-risk vertical industries after the special committee meeting, but the final decision still awaits the budget meeting results. In plain terms, everyone is now waiting for Wednesday's budget to see which path the government will ultimately adopt.
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This article is from "PASA-Global iGaming Leaders," a gambling industry news channel:https://t.me/pasa_news
Original in-depth gambling channel:https://t.me/gamblingdeep
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