June 29, 2018
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Online casino gaming is a lucrative industry in the UK. This could mean massive profits for the government - so, should it be taxed?
Online casino gaming in the UK is perfectly legal, provided you play through licensed operators. With such a large and lucrative industry, there’s no doubt that the government is going to want a piece of the gaming pie. In fact, the UK taxes businesses that offer online casino gaming to people in the UK, regardless of whether the business is located in the country or not.
So that answers that – the government is already taxing. Let’s take a closer look at what they’re taxing and what exactly they are gaining.
Taxation of the online casino industry in the UK can fall under a couple of different categories. For instance, online casino gaming is taxed as Remote Gaming Duty and therefore taxed at 15 per cent of profits.
Under UK law, offshore businesses that offer casino services to UK residents must register with HM Revenue and Customs and must pay tax. The offshore companies are required to pay either one or more of the following:
Under the UK’s laws, players are not taxed on their casino wins. So, if you place bets online and win a progressive jackpot, the hand of your life in poker or a windfall at the roulette wheel, you can keep every penny.
According to reports, gaming and betting tax receipts from the UK hit a staggering 2.7 billion GBP last year, which is double what is was just a decade ago. While this figure doesn’t distinguish between on-premise and in-person bets compared to online casino gameplay, it’s a rather large figure.
In one 2017 report from the UK Gambling Commission, it was stated that remote casino gaming is the biggest sector in the industry, accounting for a staggering 34% of the market overall and bringing in a gross yield of more than 4 billion GBP. Online slots make up the majority at 2.6 billion GBP.
Now, if we take off 15 per cent of 4.7 billion GBP, we get an amount of 705 million GBP for a year. That’s a great deal of money going back into the government’s coffers for online gaming. What’s more, that figure is expected to rise rapidly as more online operators enter the market and more players create accounts and start enjoying their favourite games.
When we think about it, though, 15 per cent is fairly standard and not that much. After all, income taxes for individuals in the UK are a great deal higher, in fact, 20 per cent more, unless you earn under 11,850 GBP per annum.
Overall, the taxation rates for online casinos in the UK seem to be fair and the profits that government make aren’t as sensational as you may have thought. It’s still an industry that continues to grow at great speed, so we may yet see the profits climbing to the billions.