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UK Online Gaming Bill Passes Review

The UK’s proposed gambling bill for online casino and betting operators has passed its first major hurdle, after it passed the review of the UK parliament’s DCMS Select Committee.

Proposed by the Department of Culture, Media and Sport (DCMS), the Gambling Bill for Point of Consumption (POC) Tax passed the UK parliament’s DCMS Select Committee’s review on Friday. The bill aims to regulate online gaming companies based outside of the UK on a point of consumption basis.

The bill also calls for all online gaming companies taking money from UK-based customers to obtain a licence from the country. Up to now, only companies which have ‘key equipment’ in the UK require a licence to operate, while companies with licences in UK territories, Gibraltar and the European Union are allowed to advertise in and take bets from the UK.

By passing the DCMS Select Committee’s review, the bill can now be introduced into the parliament to be voted on and put into legislation pending the bill’s success.  

The bill has not come without its opponents, however, with the Gibraltar Betting and Gaming Association (GBGA) threatening to take legal action against the Government if it did not change the point of consumption tax part of the bill. A number of online gaming companies with UK customers have their headquarters in Gibraltar, and they are likely to be one of the hardest hit by the tax if it is put into legislation.

The current point of consumption tax on Gross Gaming Revenues in the UK stands at 15 per cent, and would be the tax imposed on companies which are affected by this bill. While the bill passed the committee’s review, the DCMS select committee did so whilst requesting the country’s Treasury Department review that rate of tax.

This request came as the UK office of professional services firm Deloitte stated that the current rate could lead to approximately 40 per cent of existing non-UK based online gaming companies away from the UK market. UK-based online gaming operators pay corporate taxes in the country rather than a point of consumption tax, and will continue to do so even if the bill passes.

While a date has not been set, the bill could be introduced into the UK parliament as early as next week following the review’s passing of the committee.

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