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UK Betting & Gaming Tax Intake Sees Rise in 6-Month Period

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In the last six months, the UK’s betting and gaming tax intake has risen. The amount of money collected in H1 of 2022-23 in the UK from gambling and gaming taxes has risen significantly. Betting and gaming tax revenue increased by 11% between September 30, 2022, and December 31, 2022, from £1.46 billion to £1.62 billion. The largest contributor was the Lottery Duty, which accounted for 30% of the total. The Remote Gaming Duty, which accounted for 28%, was close behind.

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The mentioned taxes saw an increase when compared to the same period of the preceding year. This is possibly because betting venues and casinos were not hindered or shut down during the global pandemic in the 6-month period analyzed. This of course doesn’t seem to have had any negative impact on the online counterparts, as can be seen from the high supply and demand of no deposit bonuses which were being offered to players within the UK.

Post-Pandemic And Seasonal Factors

Despite the fact that both duties dropped both in absolute terms and as a percentage of the total when compared to the same period last year, seasonal variation and a post-pandemic landscape that was less stable on a monthly basis have led to 2022 figures showing a high degree of variability.

According to the HM Revenue & Customs (HRMC) , the UK Gambling Commission (UKGC) reported the numbers (Nielsen, 2018). A breakdown of the numbers reveals that lottery products delivered £497 million ($556.6 million) in revenue, while online gaming generated £501 million ($561 million) in taxes.

 

2021 Rise in Taxes

The rise in taxes from gaming machines was driven by the return of land-based gaming operations, which contributed £267 million in taxes (up from £106 million in H1 2020). In addition to £76 million (USD $85 million) in general gaming taxes, the casino segment posted £85 million ($85 million). Although the vertical saw an increase from H1 2021, the amount is still below pre-pandemic levels.

There was a 6% drop in betting duty from fixed-odds and pool betting, which contributed £313 million ($350.3 million) in taxes; General Betting Duties from sports betting on remote and retail fixed-odds wagering amounted to £309 million ($345.8 million).

 

Why Was There A Need For A Remote Gaming Tax KYC Process?

In recent years, the government has seen an increase in the number of remote bookmakers and remote gaming operators operating in the UK who are exempt from paying point-of-consumption tax. The main reason for this is that operators have been categorizing their business as ‘remote lotteries’ to avoid paying standard VAT and other taxes on wagering activities. Because of this, the government has initiated a new review process to re-examine the taxation of remote gaming activities in the UK, in order to prevent the abuse of existing rules and make sure the Remote Gaming Tax KYC process is fit for purpose.

Who is Affected by the Remote Gaming Tax KYC Process?

If you are a remote bookmaker or a remote gaming operator and you want to be exempt from paying point-of-consumption tax, you need to apply for an exemption. These operators will also be required to implement the Remote Gaming Tax KYC process to be exempt from paying point-of-consumption tax.

Remote gambling operators that are not exempt from paying point-of-consumption tax, but have an annual remote gaming gross turnover of less than €1 million, will not have to implement the Remote Gaming Tax KYC process. However, if an operator’s annual remote gaming gross turnover is expected to exceed €1 million in any subsequent 12-month period, they will need to adopt the Remote Gaming Tax KYC process.

What Is The Gaming Tax Intake And What Will Be Reviewed In It?

According to HMRC, the 2020-21 financial year saw a significant change in the amount of monthly receipts, which are now more “representative” across all four quarters. As a result, the figures showed a substantial variation: £500 million ($559.6 million) of the total was posted in April, while September delivered only £93 million ($104 million).

The decline in Remote Gaming Duty in the second quarter is likely an indicator of wider trends in online gambling, as many large operators reported lower UK revenues. Taxes on Machine Games Duty, Gaming Duty, and Bingo Duty may have benefited from a lack of closures and disruptions over the past six months.

Despite the fact that the future of the UK’s long-delayed gambling review is still up in the air, some alterations are already in motion. Many operators have self-imposed consumer protections prior to the UK gambling white paper, which has had a negative impact on their figures due to decreased consumer spending.

 

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