William Hill to challenge point of consumption tax

It looks like William Hill may mount a legal challenge against the British government”s planned point of consumption gaming tax, due take effect at the end of 2014.

Hills, along with High Street neighbor Ladbrokes, made the decision to move their online operations to Gibraltar and join a long list of UK betting brands (bet365, BetVictor, BetFred etc) enjoying favourable tax treatment there.

Justification for the move was pretty simple. It’s hard to compete in the UK market against operators paying less gaming tax…so as the saying goes if you can’t beat ’em, join ’em.  And they did.

Understandably, this exodus of betting companies hasn’t been well received by the British government who went to great trouble to put online gambling regulations in place only to see gaming tax revenues dwindle while the UK playing market continues to grow. Changes to the regime were foreshadowed last year, and earlier this year the Chancellor announced plans to implement a point of consumption gaming tax.

The way it will work is that regardless of where William Hill (for example) choose to base their operations, they will be liable to pay a tax in the UK based on gaming revenue generated from UK players.

William Hill CEO Ralph Topping told the Telegraph that he’d heard “encouraging noises”, that a legal challenge to the 15% point of consumption tax could be successful. CEO’s of plenty of other Gibraltar based betting firms will be hoping those noises are correct.

Another very interested party in this will be the Gibraltar Regulatory Authority, who stand to lose gaming taxes of their own if licensees decide to move back to the UK when most of the current tax advantages are lost.