William Hill is appealing a a UK court decision that exempts betting exchanges users from paying a horserace betting levy. At issue is a July 22 ruling by the Horse Betting Levvy Board defining Betfair, a popular betting exchange, as a business rather than a bookmaker.

The popular UK bookmaker is not keen to have its competition getting a pass on a tax that costs the British horse racing industry £74.9 million annually.

Who is a Bookmaker

The Horse Betting Levy Board issued its original ruling based on a 1963 definition from the Betting, Gaming and Lotteries Act. Speaking for the Board in the decision was Lord Justice Stanley Burton who said:

…The person who operates through a betting exchange may in the course of doing so find himself receiving a bet. But he does not carry on the business of receiving bets. He is not a bookmaker. It follow that he is not liable to pay the levy.

William Hill’s Case

Attorney’s for William Hill are saying that Lord Burton’s ruling misses the point entirely. What they’re looking for is a clarification of the ruling that focuses on the roles of each entity in the exchange. In a recent press release, William Hill CEO Ralph Toppings stated his company’s position:

…The only simple interpretation of his judgment -i.e. that no no users of exchanges pay levy, ever – seems to go against what Parliament has said previously about both levy, taxation and licensing, and could if unchallenged totally undermine any value in the levy.

The stakes are definitely big for both companies and this story is by no means close to a conclusion. So far there’s no word regarding when the Court of Appeals will issue a ruling on the matter.

Do you think exchanges should be treated like regular sportsbooks for tax purposes? Share your opinion on our Online Gambling Laws and Regulations Forum.


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