Gambling taxes

Stephen Hignett, Tax Partner, CMS

Today’s Autumn Statement included no mention of rates of gambling duty being raised, which is good news.

Also not mentioned was any move by the Government to change the VAT rules, such that “business to business” supplies of advertising would be treated as supplied where “used and enjoyed”.  This is the concern that advertising supplies received by, say, a Gibraltar remote operator (without VAT, as Gibraltar is outside of the EU VAT zone) might become subject to UK VAT (which would be wholly or partially irrecoverable by that operator) in circumstances where the advertising is disseminated in the UK.  Again, no news is good news (for the moment, at least).

The Government has confirmed that it will legislate to bring the remote gaming duty treatment of freeplays more in line with the treatment of free bets under general betting duty.  The changes will take effect for accounting periods beginning on or after 1 August 2017.  This is, of course, expected following the consultation over the summer.  The Autumn Statement press release (relevant to all tax consultations generally) suggests that we will receive the Government’s response to the freeplays consultation (including draft legislation) on 5 December 2016.   Having recently spoken to a member of the gambling duties team at HMRC, we have been told that the concerns expressed by operators around the way in which the new duty rules will apply to wagering requirements (which require players to keep playing before they can cash out) was at the “top of the list” of the issues raised by operators.  We will be very keen to see how this is addressed on 5 December.


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