The UK government faces calls this week to assess the economic impact of a gambling tax increase on Gibraltar. Labour MP Gareth Snell proposed an amendment during the third reading of the Finance Bill, requesting the government to assess the impact of raising the remote gambling tax to 40% and the remote betting tax to 25% on Gibraltar's economy, and to publish an assessment report by April 1, 2027. Simply put, it's the UK tax reform's shoe dropping, and Gibraltar is a bit panicked.
Gibraltar's economic pillar: One-third of tax revenue comes from gambling
Snell pointed out that one-third of Gibraltar's tax revenue comes from the gambling industry, with about 3500 people directly employed in the sector. Any decision affecting this industry, even unintentionally, will leave a huge gap in Gibraltar's economy. The Minister of Justice, Trade, and Industry of Gibraltar had previously warned that this tax reform could have direct and indirect effects on Gibraltar's public revenue, and the actual tax rate could rise to 80% to 100%.
Black market impact controversy: MP claims "threat is exaggerated"
Snell also called for an assessment of the extent of the black market's impact due to the increase in gambling taxes. However, the government believes that it is common for the gambling industry to use the black market as an excuse to evade regulation or additional taxes, and the threat of the black market has been exaggerated. Citing a 2021 Gambling Commission study, only a very small number of British gamblers use unlicensed sites. The government ultimately stated that it would not make further amendments to the bill, but will monitor the impact of the tax reform and continue to communicate with the Minister of Gibraltar. Want to know the latest developments in UK gambling tax policy? PASA official website keeps track.
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