Sky Bet Performing Well but Warns Government Against Tax Hike

Sky Bet has warned the government not to penalise UK-based operators by raising the point of consumption tax on betting revenue.

Philip Hammond betting tax. Philip Hammond betting tax.

Sky Bet chief executive Richard Flint has asked Chancellor Philip Hammond (pictured) not to increase betting tax. (Image: Secretary of Defense/Wikimedia.org)

Following the publication of the online operator’s latest financial report, Sky Bet chief executive Richard Flint has written to Chancellor Philip Hammond to ensure a tax rise isn’t in his plans.

Although the Chancellor hasn’t suggested he wants to increase the point of consumption tax that was implemented in 2014, Flint is bidding to avert any potential moves before they happen.

Changes Aren’t a Longshot

With the government already in the midst of reviewing a potential change to the betting limits inside fixed odds betting terminals (FOBTs), a point of consumption tax increase isn’t out of the question. For UK-based operators such as Sky Bet, this could mean even higher costs.

Sky Bet released another positive revenue report on November 8 which showed a 38 percent increase in group revenue to £516 million between 2016/2016. Off the back of this growth, the gaming company has pledged to create 200 high-tech jobs in its county home of Yorkshire.

However, despite being committed to the UK iGaming market, Flint has said that he’s not willing to remain a resident at any cost.

“We are prepared to have the penalty of higher taxes versus being based offshore but it could become unsustainable if taxes are increased too much,” wrote Flint.

UK Won’t Stay at All Costs

As it stands, Sky Bet already pays the 15 percent point of consumption tax on all bets made by UK customers, even though it’s based inside the country. Additionally, unlike offshore operators serving the UK, Sky Bet has to pay VAT on its marketing expenses.

While the company is prepared to accept these conditions in a bid to boost the UK economy, it can only put up with so much. Indeed, as well as potentially forcing Sky Bet to move offshore to a gambling haven such as the Isle of Man, a tax hike could harm jobs in the local area.

Sky Bet has more than 1,300 employees in the UK and its headcount is increasing year-on-year. But any additional financial burdens imposed by the government could force it to scale back its current operations and relocate resources in a bid to reduce costs. 

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