Many online gaming companies, including PartyGaming, are headquartered in Gibraltar (or “The Rock” as it’s often called), because of the location’s unique tax status as a British territory in a foreign country (Spain).

The Guardian describes Gibraltar as a “virtual Las Vegas”, adding that “in online gambling it has hit the jackpot.” Now, the government of Gibraltar is looking to capitalize on the presence of so much business by raising taxes on Internet gambling companies located there.

“Online companies pay 1% tax with a ceiling of €500,000 a year,” the Guardian explains, stating that the new tax rate will be 10%. That’s still substantially smaller than the approximately 15% levied by the mainland United Kingdom.

“Nobody will leave, although we’ll all complain about the tax going up,” Victor Chandler told El País newspaper, per the Guardian article. Victor Chandler International was one of the first online gambling companies to move to Gibraltar, way back in the early years of iGaming, 1998.

According to Gibraltar officials, the tax raise is legally necessary. “To comply with EU law we must phase out the tax-exempt company in 2010,” Peter Caruana, Gibraltar’s first minister, said.

Ireland may soon do the same. “Minister for Finance Brian Lenihan announced in the Budget that the Government intended extending the existing 1 per cent levy on betting turnover in bookie shops to online operators who were not currently subject to the charge,” the Irish Times reported.

If that happens, Irish online betting companies like Paddy Power and BoyleSports may be heading to the Rock, as well.


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