Gibraltar betting industry renews court bid to reverse UK tax regime
One of Britain’s leading lawyers Lord Pannick, QC, will be heading a team of Gibraltar Government experts at the Royal Courts of Justice in London this morning as the local gaming industry takes on the British Government over tax issues, reports the Gibraltar Chronicle.
Government is not participating directly in the action but local QCs Peter Montegriffo and Peter Caruana will also be present alert to issues arising that have implications for the jurisdiction and its licensing authority. The Government is there as an interested party in the claim.
Appearing in Court 19 in what is expected to be a three day hearing before Mr Justice Charles, many of the arguments are likely to echo those before a similar hearing last year when the point of consumption tax on gaming was challenged.
The legal action is brought by the Gibraltar Betting And Gaming Association on behalf of the local industry against HM Revenue and Customs and HM Treasury .
The challenge is to the tax regime introduced into the UK Finance Act 2014 which received Royal Assent on 17 July 2014, and the associated notices and guidance issued by HMRC.
The regime imposes gambling excise duty liabilities and potential sanctions on remote gambling operators on what is said to be a “place of consumption” basis. This means it requires gambling operators to pay UK duty in respect of services provided to “UK persons” even where the operator is located in, and those services are provided from, another country.
The new tax regime has replaced a “place of supply” taxation regime under which operators based in the UK were charged UK duty on their gross gambling profits from their supply of gambling services to customers worldwide.
The GBGA is arguing that the new tax regime is incompatible with requirements of EU law guaranteeing freedom to provide services and prohibiting discrimination.
One possibility that the GBGA is inviting the court to consider is to refer some of the arguments to the Court of Justice of the European Union for a preliminary ruling.
GBGA says that the issues raised by this case concern fundamental principles of EU law on which there is at present no clear authority.
