William Hill prepares to challenge UK online gaming tax
30 July 2012
Posted by: SAIT Technical
By Nathalie Thomas (The Telegraph)
Britain's biggest bookmaker is preparing a legal challenge against government plans to tax online gambling in this country from the end of 2014.
William Hill has asked its lawyers to build a case against the UK's proposed "point of consumption tax”, which will impose a 15pc duty on online gambling profits generated in this country.
Almost all UK bookmakers, including Ladbrokes, have shifted their online businesses to gambling-friendly tax havens such as Gibraltar and the Isle of Man over the past decade.
But earlier this year the Chancellor announced he wanted to impose a 15pc duty on bookies that offer online betting in this country in an effort to raise about £200m a year.
Betting lawyers warn the proposed tax is "illegal” under European law as it is an attempt to restrict the free movement of goods and services for tax purposes.
Ralph Topping, chief executive of William Hill, said he had received "encouraging noises” from lawyers that the betting giant would have a solid case against the 15pc point of consumption tax. William Hill's digital profits reached £68.9m in the first half of the year.
Legal experts warned the Government was trying to shut the stable door after the horse had bolted after it liberalised online gambling in 2007. Jason Chess, betting and gaming partner at law firm Wiggin, said: "You cannot restrict the free movement of goods and services in order to raise your own national tax. We can't stop BMW from selling BMWs in this country because the tax is paid in Germany.”
Betting authorities in Gibraltar are also considering taking the UK to court over the tax amid fears it could encourage bookies to shift their online businesses back to Britain.