UK's Gambling Commission Chief Sounds Cautionary Note On Tax

by Jason Gorringe, Tax-News.com, London

27 October 2005

The new head of the United Kingdom's Gambling Commission has warned that the government will fail in its attempt to lure online gambling firms to the UK from offshore jurisdictions such as Gibraltar if it sets an unattractive rate of tax under new betting laws.

Speaking in an interview with the Financial Times, Peter Dean, chairman of the Gambling Commission, stated that it was the government's "expectation" that gambling firms would seek to set up in the UK under the Gambling Act 2005, which is expected to come into force in September 2007.

However, he cautioned that gambling firms would snub the UK if the new tax regime is regarded as being too punitive.

"It behoves the Treasury to be mindful of the fact that we can't force companies to come here," Mr Dean told the FT.

"The simple point is that if the [tax] rate is set at a level that deters companies from coming here then the Gambling Act 2005 will be frustrated," he added.

Earlier this month, the Gambling Commission, which has replaced the Gaming Board as the industry regulator in the UK, launched a major consultation on the licencing and regulation of the gambling industry.

Mr Dean explained that the Commission will be setting new conditions under which licences are granted to gambling operators and staff and issuing new codes of practice.

"We will (also) have legal powers to monitor the industry and to prosecute illegal gambling," Mr Dean stated.

“The Commission’s aims are to keep crime out of gambling, to make sure it is conducted fairly and openly, and to protect children and vulnerable people," he added.

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