The British government has announced a £300 million clampdown on tax avoidance by offshore internet gambling firms that avoid paying UK taxes by basing themselves outside the UK but target British customers.
The government has proposed new rules and sanctions to ensure that remote gambling operators with UK customers will pay UK gambling taxes from next year, no matter where they are based.
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The changes, which are due to come into force on December 1 2014, will mean that all remote gambling companies will be taxed on their gambling profits from UK customers.
The new rules will be supported by tough enforcement measures, including criminal offences and prison sentences of up to seven years for executives.
The UK plan is to cream a 15% tax benefit from transactions when UK punters are gaming online with Gibraltar companies.
The government is also requiring all gambling companies with UK customers to obtain a domestic licence through the Gambling Commission.
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By GlobalDataThe Gambling Commission estimates that the UK remote gambling market is worth over £2 billion per year. The new rules will bring in £300 million per year in additional tax revenues.
Economic Secretary to the Treasury, Sajid Javid, said: "It is unacceptable that gambling companies can avoid UK taxes by moving offshore, and the government is taking decisive action to ensure this can no longer happen in the future.
"These reforms will ensure that remote gambling operators who have UK customers make a fair contribution to the public finances," Javid added.
