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An op-ed article in The Guardian is highly critical of the gambling reform developments in Britain and the impending control of the Gambling Commission, which will regulate UK gambling from September 1. “The idea was to make Britain a friendly place for online gambling operators. Britain would be pragmatic: the operators would be treated as legitimate businesses if they agreed to act responsibly.
The newspaper, commenting that the Commission now has at 200, twice the staff of the old Gaming Board, and says that two of its intended workloads have already disappeared - Prime Minister Gordon Brown has killed off the super-casinos and the world's online poker and casino companies have declined the invitation to come to Britain to be regulated. The article claims that these facts illustrate how the Gambling Act has failed to deliver even the government's watered-down intentions.
It hasn't worked at all, claims the article. Only 14 online poker and casino operators have registered for UK licenses and virtually none of these is a mainstream company. The explanation appears to be simple - nobody wants to pay tax at the UK rate of 15 percent of gross profits.
“Computer servers that power the websites can be located almost anywhere,” says The Guardian drawing attention to the borderless nature of the world of internet gambling. “To be able to advertise in Britain, an operator merely needs to be within the European Economic Area, so Malta is suddenly popular. Tax rates in Malta have been cut to 2.5 percent and at last count, 200 online gambling companies had applied for licenses there. The Gambling Commission's bureaucrats in Birmingham have been bypassed.”
“We in the industry think that Britain might think about cutting its tax rate to match Malta's. Of course that’s not going to happen: it knows the headlines in the Daily Mail would be horrible.” The author concludes, “We have a mess.”
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