GBGA returns to court for latest legal challenge over UK tax regime

GBGA returns to court for latest legal challenge over UK tax regime

Tuesday, March 24, 2015 Totally Gaming

The Gibraltar Betting and Gaming Association (GBGA) returned to court today (Tuesday) in its latest effort to reverse a new gambling tax regime that has been introduced in the UK.

The new regime, which came into law through its inclusion in the UK Finance Act 2014, features a ‘point of consumption’ tax rule that requires operators offering services in the UK market to pay tax no matter where they are based.

Existing regulations in the UK stated that only operators actually based the UK had to pay this duty, meaning those operating from overseas avoided the duty. However, as part of a move to capitalise on the growing online gaming market, as well as to protect UK players, the UK Gambling Commission opted to develop the new regulations.

Although the measures were passed into law last year, they have attracted plenty of criticism from operators based overseas that previously avoided UK tax duty. The GBGA has also been openly critical of the regime and the impact it could have on its own gambling market.

The Gibraltar body last year launched legal action against the UK in an effort to stop the regime coming into force. Despite having succeeded in delaying the new regulations, the regime was finally introduced in the UK late last year.

However, the GBGA has now launched another legal challenge in an effort to convince lawmakers in the UK that the regime is not compatible with the European Union law that guarantee freedom to provide services and prohibit discrimination.

According to various reports, Lord Pannick QC, a leading lawyer in the UK, will head a team of Gibraltar Government experts in what is expected to be a three-day hearing at the Royal Courts of Justice in London. The hearing began this morning.

Despite having entered legal proceedings in the UK, the GBGA may recommend that the case is referred to the Court of Justice of the European Union for a preliminary ruling in order for its concerns over EU law to be addressed directly by the continental body.

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