UK Gaming Policies Hindering Growth

The European Union is in serious trouble. Massive deficits in Greece, Portugal, Spain and Ireland are threatening the stability of the multinational Euro. In a pre Christmas report the European Parliament ruled that online and land-based sectors of the same industries are in direct competition and governments cannot favor one over the other. The EP ruled that government policies favoring one sector amount to state aid. Land based casino and bingo operators in the UK say that tax policies that favor online bingo and casinos are unfair and potentially illegal under the new ruling by the European Parliament.

For years land based bingo operators have said that UK tax policies give online bingo operators an unfair competitive. Currently bingo clubs pay a much higher tax rate than their online counterparts. Offshore bingo sites enjoy even lower tax rates giving them an unfair advantage. New government policies may change all that. Offshore gaming sites will be required to have a UK license to accept wagers from UK residents and will be taxed at the same rate as sites licensed in the UK. This will also remove the incentive for operators to locate offshore taking jobs with them.

In recent months the Parliamentary Select Committee for Culture, Media and Sport was convened and has been researching the effect of gambling legislation in the UK and why the laws have failed to deliver the results anticipated by ministers. Gaming experts have pointed out that Britain’s land based gambling sector has the potential to create much needed jobs and contribute to economic growth. Experts say that this can only happen when the government puts an end to the subsidies enjoyed by online bingo and gaming operators. According to the policies set by the European Parliament these subsidies amount to state aid. Land based operators say that both online and land based gaming should be subject to the same rate of taxation.

The UK Gambling Act was designed to create a modern gambling industry that would make positive contributions to the nation’s economy. The act was also designed to adapt to changing technologies and protect the interests of players. Overall the Gambling Act has been successful and many of the policies have been copied by other countries. It is the disparity of tax rates that is the fly in the ointment. The recent report by the European Parliament may force much needed changes in UK gaming policies.

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