Earlier this week, the UK Treasury has published a summary and its response to a consultation on the planned “point of consumption” gambling tax expected to be introduced at the end of the year. It also published the first draft of the new regulations. A final draft will be produced this year, followed by a last consultation process before being introduced.
The government expects to move forward with a 15% tax on gross profits, despite multiple consultation responses—including one extensive response from pokerfuse—that recommended otherwise.
Keeping the 15% tax is no surprise: As reported exclusively by pokerfuse, the figures presented in the 2013 budget showed that the government has already planned its finances on the basis of a 15% tax rate.
Player Fund Protection
Most importantly for players, it appears that the Treasury has taken notice of the need for protection for player funds deposited on online gambling sites. In the draft of the attached bill, paragraph 23 (8) gives the UK Gambling Commission the power to determine how player funds should be controlled:
The Commissioners may by notice published by them make provision about gaming prize funds, and the notice may (in particular) make provision – (a) as to how such funds are to be held, (b) requiring information relating to such funds to be recorded by persons responsible for them, and (c) requiring such information to be provided to the Commissioners.
Another important clause in the bill was regards to player location. The Treasury has rejected more complex forms of location verification and instead announced that it would use the residential address registered by players with the operator to determine whether revenues generated by players would be liable to the new tax.
This means foreign visitors to the UK will be able to play online without operators having to apply the tax to revenues generated by them.
The Treasury has set a deadline of September 30 for comments on the document and the draft legislation. A full draft of the bill will be published in the Autumn, to be followed by an eight week consultation period. The timetable implies that the law is likely to come into effect in the new financial year starting April 2014.
Learn more about the UK legislative changes:
What the New UK Legislation Will Mean for Online Poker