..

Betfair the Latest Online Gambling Firm to Move off British Shore

Written by:
Guest
Published on:
Mar/08/2011

LONDON - (Reuters) - Betfair (BETF.L), the world's largest betting exchange, said it would follow rivals Ladbrokes (LAD.L) and William Hill (WMH.L) by moving part of its business to Gibraltar to slash its tax burden.

Betfair, founded 10 years ago by one-time professional gambler Andrew Black and former JP Morgan derivatives trader Ed Wray, said it expected to save 20 million pounds ($32 million) a year as a result of the switch, which will see its betting exchange operate under a Gibraltar licence from Wednesday.

Betfair currently pays 15 percent tax on gross profit from betting, but this will drop to 1 percent following the move.

On a conference call with reporters, CEO David Yu said Betfair was also looking to avoid the so-called "double taxation" which it is currently faces under UK tax regulations.

"When you look at how the UK does their taxation, it's based on all revenues rather than where the customer is located. For example, if you're paying tax to a local jurisdiction it doesn't really work to have a case where you're double taxed both in the UK as well as the other jurisdiction," he said.

Britain is reviewing its licensing system for gambling companies following the decision of Britain's two biggest bookmakers William Hill and Ladbrokes to relocate their businesses to Gibraltar in order to pay less in taxes.

"The question mark is whether this provokes any response from the UK government, now most of the online gambling companies have moved offshore," said Liberum Capital analyst Richard Taylor.

Taylor said the tax change could add 66 pence per share to Betfair's value based on 2012 earnings and 10 million pounds worth of annual savings rising to 121 pence per share when the savings increase to 20 million.

Shares in Betfair were up 5 percent to 933 pence at 1030 GMT. They were sold at 1,300 pence in an IPO last October and hit a high of 1,610 pence that month, but their value has slumped on the back of fears over increased regulation.

Business/Financial News

Fake News: Litecoin Foundation Says No Deal With Walmart

Walmart had earlier disputed the claims after a number of outlets reported on the fake story.

Bitcoin is Barter, Not Money, Mexico Central Bank Chief Says

Bitcoin is Barter, Not Money, Mexico Central Bank Chief Says

Bitcoin is more like a means of barter than "evolved" fiat money, Mexico's central back chief said on Thursday, calling it a high-risk investment and a poor store of value.

El Salvador's World-First Adoption of Bitcoin Endures Bumpy First Day

El Salvador's World-First Adoption of Bitcoin Endures Bumpy First Day

El Salvador's historic adoption of bitcoin as legal tender on Tuesday was beset by teething problems, as an angry protest by mistrustful citizens, technological glitches and a dip in the cryptocurrency clouded the rollout.

9 Weeks Free Pay Per Head

9 Weeks Free Pay Per Head

There is plenty more to get excited about ahead of this NFL season if you are a bookie or agent looking for a new Pay Per Head or to switch over your players from your current platform (in under an hour).

Bitcoin Fever Reaches Honduras With First Crypto ATM

Bitcoin Fever Reaches Honduras With First Crypto ATM

The first cryptocurrency ATM in Honduras opened this week as Bitcoin backers sought to spur demand for virtual assets after neighbouring El Salvador became the first country to establish bitcoin as legal tender.

Syndicate