What Does Brexit Mean For Online Gaming?
Brexit is looming, and regardless of the outcome there’s no arguing that it will change the British business landscape dramatically. Betting and gambling is one of the UK’s biggest industries, and while it’s difficult to make predictions, it’s likely that Brexit will result in both positives and negatives for the country’s gambling industry. With only £1, £5, £10, £20 as a deposit
Throughout the online gaming revolution, the UK imposed the heaviest regulations on the gambling market throughout Europe, and it’s impossible that they will run into regulation hurdles after Brexit. In fact, it’s thought that all the current laws the UK have in place regarding online gambling, licenses, and procedures, will maintain their validity even after their exit from Europe.
The Gambling Act was renewed and amended in 2014, and according to the Act, all offshore gambling companies must obtain the license from the UK Gambling Commission. Foreign operators looking to market their product in the UK, can do so with special permission.
Gaming tax is a whole different topic and if the UK should leave the European Union without an agreement, it’s possible that the country will fall back on World Trade Organization regulations and rules. This could potentially create a barrier for operators outside of the UK to offer their services on UK soil and if the gaming tax law is not adjusted correctly, Brexit could be the result of many company doors closing.
The European Single market allows for the free movement of money, services, labour, and goods and arguably, this was one of the biggest reasons the UK joined the European Union in the first place. The free movement enhanced the economy and made trading that much easier. Many UK bookies were in a prime position to sell their product throughout the European Union, without any additional taxes, but after Brexit, this strategic service will become unavailable.
One of the most important concepts of the European Union is the ‘Four Pillars’, a representation of the free movement of goods, services, people, and capital. This has resulted over the past years in a seamless movement of headquarters offshore. Whether or not the UK gambling sites will be able to continue the tax-efficient savings the Single Market provides, ultimately depends on the withdrawal agreement.
British Overseas Territories
Brexit is also going to open a lot of questions regarding British Overseas Territories like Gibraltar,
A small island with an area of 6.7km, located at the southern top of the Iberian Peninsula. Gibraltar is considered British Overseas Territory and as they won’t be participating in the referendum, this means they will cease to be a part of the EU after the UK withdraws. As Gibraltar is the home of many betting companies today, this has raised concern. According to Gibraltar’s Commerce Minister, Albert Isola, the gaming industry generates around 25% of the country’s total gross domestic product.
After the exit, gaming operators will have to deal with finding cheaper labour, and accept the costs of setting up new offices, taxes and trade agreements. This can potentially lower the profits for bettors, lower odds on popular sports or events, less offers of online casino bonuses and promotions and a radical adjustment in Casino Payment options.
The Effects of Brexit on Online Gambling
After more than three years since the infamous Brexit referendum, we’re still no closer to knowing what the implications will be, but for the UK and the wider European markets. Regardless of whether its free-trade agreements, fishing rights, real estate or the cost of food, Brexit is the cause of many more questions than answers.
What began as a mass market for horse and greyhound betting markets very quickly transitioned into a global online space placing the UK is at the forefront of gambling innovation. In fact, the market share in the UK gambling industry is shifting in favour of the online and mobile space, which has caused betting shop revenues to suffer.
Last year the UK government announced it would be reducing maximum fixed-odds betting terminals from £100 per spin down to just £2 and industry experts expect that this could result in thousands of job losses and a significant reduction in annual tax receipts for the UK government. In response, the UK announced that in October 2019, it would increase the online casinos UK tax rate from 15% to a whopping 21%.
Off-Shore Gambling Legislation
Most online casinos that offer their services to UK players are based abroad and much of this market is dominated by the likes of Malta, Gibraltar, Jersey and the Isle of Man. How Brexit will affect the online gambling industry remains to be seen. The possibility of a “hard Brexit “, the term assigned to the real possibility that the UK will leave the European Union without coming to an agreement, would cause a regulatory conundrum for the UK gambling industry based offshore in places like Malta and Gibraltar. UK companies based on mainland Europe will need to be treated the same as companies from other parts of the world meaning that UK gambling firms will no longer be accustomed to the benefits of friction less cross-border operations and the tax-efficient benefits that the Single Market offers. In other words, EU state members might be forced to implement taxation tariffs on profits generated by UK online gambling companies and in so doing, wave goodbye to favourable tax benefits.
Although there are still many questions that need serious answers, the certainty is that many things will change post Brexit. We may see some companies relocating from Gibraltar elsewhere to continue their operations, we may not, the answers are still unclear. But what is certain is that everyone will be watching over the Brexit negotiations as they unfold to see what happens after the UK’s exit, set to happen at the end of 2019.
UK Minimum Deposit Casinos
While Brexit is still causing shock waves to spread throughout the online casino world, for now, things will remain the same as they’ve always been. In the past few years, minimum deposit casinos have grown in popularity and these days it’s entirely possible to gamble online with only $1, $5, $10, $20 as a deposit. Although it’s a certainty that Brexit will change the face of online gambling, the certainty is that minimum deposit casinos will continue to flourish. Making a small deposit online with the possibility of receiving a Welcome Deposit is too much of an attractive incentive, and while we wait for the answers to arrive, we’ll keep gambling online at the best UK sites on the internet! Have a look through our UK minimum deposit casinos and Canadian and Irish deposit casinos for top casinos that offer safety and security, and attractive Welcome Bonuses and free spins.