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HM Customs and Excise 2 9 November 1999 GOVERNMENT TO TAKE ACTION ON OFFSHORE BOOKIES The Government is to take action against the threat to the UK betting
and racing industries from offshore bookmakers, the Chancellor announced
today. Steps to protect these important UK industries will start with a
strengthening of the ban on advertising by offshore bookmakers on
teletext services and other media in the UK. The Government has ruled out no options in its effort to discourage
offshore betting and protect the revenue, and may bring forward further
measures in the Budget. NOTES FOR EDITORS 1. General Betting Duty receipts are up by 3.5 per cent in 1999
compared to 1998, but the government is concerned this trend will
be reversed if the big bookmakers carry out their threat to take their
telephone credit business offshore. 2. Duty rates at 6.75 per cent are about the average by international
standards. 1.25 per cent goes to the horseracing levy, and raises
some £52 million per year for the UK horseracing industry. The
UK racing industry employs 50,000 people and the UK betting industry
employs another 35,000. 3. UK bookmakers have been operating offshore betting centres for
several years. Until recently their impact upon the UK betting market
was constrained by a voluntary code between them that they would not
accept bets from the UK. The code was breached by Gibraltar-based
Victor Chandler International in May 1999, which actively sought to
attract UK customers. Chandler charges a 3 per cent levy on these
UK bets. 4. This competition has caused the big UK bookmakers to consider
expanding or setting up their own offshore centres to take UK bets.
5. This has forced the government to intervene in order to ensure
that UK bookmakers can operate in a fair competitive environment,
pay their fair share of taxes, and provide the financial support to
the racing industry upon which the betting industry depends. 6. Currently, offshore bookmakers are able to exploit a loophole
in the ban on advertising in the UK by promoting 'tax-free' offshore
betting on teletext services and other electronic media. The Government
will be strengthening this ban, and making it more flexible so that
any further avoidance schemes can be quickly tackled. Media enquiries only to: HM Customs and Excise, Public Relations Office, New King's
Beam House, 22 Upper Ground, London, SE1 9PJ. Telephone: 0171 865
5471/5472. Other individuals or companies should contact their local
VAT Business Advice Centre, listed under Customs and Excise in the
telephone book. Customs and Excise Internet address: http://www.hmce.gov.uk
This news release can also be found at: http://www.hm-treasury.gov.uk
Other Treasury material can also be found at this address.
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