UK move blow to betting crackdown
The Government has suffered a new blow in the battle against illegal betting with Britain giving online bookmakers a boost by abolishing betting duty.
The Jockey Club described the move as significant for world betting and branded the duty as outdated.
The decision by the Chancellor of the Exchequer, Gordon Brown, this week means that British bookmakers, the world's biggest, will be able to offer attractive odds to local punters.
The British Government was known to have been alarmed by the potential loss of revenue by legitimate bookmakers going abroad to launch Internet sites. It is the fear of loss of revenue that drove Financial Secretary Donald Tsang Yam-kuen to offer a strong hint in his Budget Address that football betting should be legalised.
But Mr Tsang refused to cut betting duty, despite repeated warnings from the Jockey Club that revenue would continue to plummet.
Kim Mak Kin-wah, the club's executive director of development, refused to play down the UK's move. 'I am sure it's a significant move, not only for Hong Kong but all the horse racing jurisdictions of the world,' he said.
'The UK has one of the longest racing histories and recognises that betting duty is out of date. The move also recognises that regulated products must be price sensitive to contain offshore betting and to retain revenue and jobs. It is an important point.'
Mr Brown announced his move when delivering his own budget just hours after Mr Tsang had addressed the SAR. UK betting duty will be replaced by a 15 per cent profit tax on bookmakers' gross profits, a move experts believe will encourage betting.
The British Government has previously collected a betting duty of 6.75 per cent from the bookies, which was passed on to punters in a nine per cent tax.
Punters have been flocking to offshore sites because online bookmakers have been able to offer favourable odds by avoiding betting duty and other taxes. Even William Hill, the world's largest bookmakers, has been forced to bow to the trend and set up a site in Antigua, a renowned tax haven.
Tim Lambe, whose Easybets Web site is also located on the Caribbean island, said: 'When this happens there shall be no commercial reason to be located offshore anymore.
'The industry will likely grow much faster than previously projected as most restrictions would be lifted because it is endorsed by a major government.'
British bookmakers believe their share of the global market will grow markedly.
Warwick Bartlett, chairman of the British Betting Offices Association, said: 'I can see turnover increasing substantially. I see us attracting people from abroad, and punters who have been betting offshore will be coming back to us.'
The Government refused to comment on the British move. A spokeswoman said: 'We have no plans to abolish betting duty.'
