Gambling tax reforms to come into effect
The introduction of changes to the basis of taxation for gambling duties from ‘place of supply’ to ‘place of consumption’ will come into effect from the beginning of next month. With a place of consumption tax basis, remote gambling operators will be required to pay tax on the gross gambling profits generated from UK customers, no matter where in the world the operator is located. The premises-based gaming sector which relates to businesses such as casinos or bingo halls will not be affected by these new rules unless they also offer remote betting or gaming.
The changes will affect General Betting Duty (GBD), Pool Betting Duty (PBD) and Remote Gaming Duties (RGD). GBD covers more general betting such as fixed-odds betting and pool bets on horse and dog racing. PBD applies to pool betting (other than on horse and dog racing) and non fixed-odds betting. RGD applies to remote gambling, for example casinos and bingo played through the internet. Existing GBD, PBD and RGD operators, will see some changes to the way the duties are administered whilst many other businesses will have to pay these duties for the first time.
The legislation that puts in place the rules for the making of returns, the payment of duty and the provision of information by betting exchange operators to bookmakers has been laid before parliament and comes into force on 1 December 2014. HMRC has also published detailed guidance for GBD, PBD and RGD.