HM Government of Gibraltar has, in its July 2018 Budget Parliamentary speech announced its decision to implement new arrangements for both new licence fees and charges (on renewal of licences) and new gambling duties with effect on 1st April 2018.The changes arise as a result of the enactment of the Gambling (Duties and Licensing Fees) Regulations 2018 ("the Regulations") passed under the provisions of the Gambling Act 2005 and Interpretation and General Clauses Act.
In summary, the industry is being moved on to a charging model with substantially higher annual licence renewal fees, typically £100,000 for each B2C licence (both land based and remote) and £85,000 for each B2B licence, with gambling tax now only paid by the B2C operators on their gross receipts, both gaming receipts and betting receipts, at the rate of 0.15%.
A "licensing year" for the purposes of renewal of licences and payment of the annual licence renewal fee now means a year starting on 1st April and ending the following 31st March.
The applicable tax rates are set out in Schedule 1 and the licence renewal fees in Schedule 2 of the Regulations. The Licence renewal fee is payable annually on the 1st April or at the discretion of the Licensing Authority may be payable by way of quarterly instalments on 1st April, 1st July, 1st October and 1st January of each licensing year. The 0.15% duty applies to:
- general betting (with the first £100,000 of the operator's gross betting profit on bet receipts in each year being exempted);
- betting intermediary's (with the first £100,000 of the operator's gross profit on betting event revenues in each year being exempted); and
- general gaming (with the first £100,000 of the operator's gross gaming yield on gaming receipts in each year being exempted);
The Regulations include anti-avoidance provisions whereby the Licensing Authority may disregard any arrangements made by an operator (or part thereof) to eliminate or reduce duty or licensing fees which are considered by the Licensing Authority to be artificial or fictitious.
Further any change in status of an operator including suspension or revocation or surrender of a licence does not affect the operator's obligation to pay licence fees or duty under the Regulations in respect of the period or activity for which the duty or licence fee is due.
These changes are the first to be introduced by HM Government of Gibraltar since the enactment of the Gambling Act 2005.
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