UK Online Gambling Shows Growth Rate of 80% Since 2008

UK Online Gambling Shows Growth Rate of 80% Since 2008While most industries continue to suffer from the financial crisis in the UK there is one sector that is doing very well. The nation’s online gambling industry is thriving and in 2012 it brought in an estimated £2 billion. The figure represents an impressive increase from industry earnings of £1.27 billion generated in 2008. The figures point to an 80% increase in the revenues generated by the online gaming industry. Bookmaker William Hill has the largest market share at 15%followed by Ladbrokes, Paddy Powers, Betfair and Bet365 having 11% each.

The largest sector of the British online gaming industry is sports betting which represents 44% of all wagers placed in the UK. Sportsbetting has grown by 102% since 2008 and is now worth £1 billion.  Online casinos are up by 79% since 2008 and have a 23% market share. Online bingo is up a whopping 150% and has a 17% market share. Poker came in last and has only grown by 8% to 15% of the online gaming market. Although the figures may seem impressive the UK government estimates that it has lost about £2.1 billion in revenues since it imposed a 15% tax for operators in the UK.

Because of heavy taxation in the UK today there are about 2,500 online companies operating from jurisdictions like Gibraltar, Malta and the Channel Islands where taxes are much lower. To lure these companies back to the UK the government is considering lowering the tax rate on internet gambling to 10%. Despite the proposal many online gaming companies, including William Hill, have said they would not return to the UK because of taxes and regulations that would cost them money. The UK plans to require all operators doing business in the UK to obtain a UK gaming license and all transactions would be taxed at the point of consumption.

Hugh Robertson, the Minister for Sport & Tourism, said the new policies are about consumer protection. Robertson told reporters “These proposals will ensure that British consumers enjoy consistent standards of protection, regardless of where a gambling business is based.” Not everyone is happy about the prospect of offshore gaming companies returning to the UK. Anti-gambling activists are also not happy about the impressive growth figures and say that some of that growth was financed by gambling ‘addicts.’ They say that evidence shows that there are 150,000 problem gamblers in the UK and that each problem gambler has an average debt of £17,500.

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