• 15% RTG Tax Hurts UK Aspiration To Lead In Online Gambling

    22 March 2007

    eGamingReview reported the Remote Gaming Association (RGA) has expressed disappointment at the 15% rate which the UK chancellor Gordon Brown has set for the new remote gaming tax.

    The remote gaming tax rate has been set at the same rate as gross profits tax payable by UK-based bookmakers.

    John Coates, RGA chairman, said the 15% rate means the UK government has “effectively turned its back on the industry”. “Under this regime, with the additional VAT and corporation tax for most companies, it would be almost impossible for a UK-based operator to compete with offshore businesses, especially those located in other EU jurisdictions.”

    However, Clive Hawkswood, chief executive of the RGA, did say there was some good news for the industry from the budget. Contrary to some fears that the chancellor had plans to levy VAT on participation charges, such a measure was not introduced.

    In a seperate article eGamingReview reported in part: The Remote Gaming Association (RGA) was quick to add that the new remote gaming tax rate of 15% effectively closed the door to any online gaming companies returning to the UK. Chairman John Coates said: “Quite simply, under this regime, with an additional VAT and corporation tax for most companies, it would be almost impossible for a UK-based operation to compete with offshore businesses, especially those located in other EU jurisdictions.” Martin Dane, tax principal at BDO Stoy Hayward, said the 15% rate was a “real bolt from the blue”. He added: “Together with no indication that the corporation tax regime will recognise the potentially huge tax cost of becoming regulated, this sounds the death knell for the UK government’s aspiration to be the world leader in regulated remote gaming.”