by Renee Israel
July 3 -The Telegraph recently published an article
reporting that UK land and online bookmaker, William Hill has
decided to take leading sports betting exchange Betfair to court.
William Hill, according to the article, believes that
it is unfair for Betfair to be excluded from funding British
horseracing, under the law that betting exchanges are not subject
to the levy that traditional gambling companies are.
It is believed that the William Hill action is being
backed by the British Horseracing Authority which is seeking to
challenge the government ruling and create a level playing field
for UK bookmakers and betting exchanges alike.
Betfair is countering that although it is not legally
subject to the levy like other bookmakers in the UK, it still
makes a voluntary contribution to the UK horse racing industry.
Betfair Opponents Call for Taxation
The newspaper explained why there was a call for
Betfair to also pay the racing levy to the government.
"Betfair's opponents argue that its unusual business
model - where punters place bets with other users who hold the
opposing view - attracts professional gamblers who are betting in
such volumes that they should be licensed and taxed in the same
way as traditional bookies."
The betting exchange, which is licensed and regulated
by the Gibraltar government, has countered that its customers are
not businesses, but rather individuals, and it thus should not be
taxed in the same way as UK bookmakers.
The group's interim Chief Executive, Stephen Morana, said he was
confident that the Horserace Betting Levy Board's decision to keep
betting exchanges out of the levy pool would be upheld.
Betfair Looking at International Expansion
While Betfair is challenged over tax payment by William
Hill, the group has said that it expected to pay "one off" tax
charges in the coming year as it breaks into developing European
In May this year, Betfair was asked to pay over €10 million to
Spanish tax authorities before it could obtain a license to
operate in Spain's newly regulated gambling market.
"Italy and Spain are two of our key markets and after some
finalisation of regulation with both of them, we will push on
aggressively," noted Morana. "The caveat is regulation. There will
be new one off taxation hits as we expand but if you pay more tax
in the short term it allows you to grow your business in the long