Without getting into whether or not the cuts administered by the UK Government are fair or even the right way forward given the state of the economy there is one thing for certain…. People are suffering from the cuts and companies are struggling as the government turns a blind eye to offshore gambling.

From today Betfair follows rivals William Hill and Ladbrokes in operating parts of their businesses from Gibraltar to avoid the UK taxes. The UK-based online gaming site announced that its betting exchange will now be operating under a Gibraltar license.

While UK land based gaming clubs are struggling with the high taxes online operators are able to move their operations offshore where they pay a minimal amount of tax. Firstly it is unfair on companies based in this country who could do with a slight reduction in the tax paid and secondly to the UK residents that are struggling as the government makes them pay to cover the budget deficits. Our message to the coalition government: “Put your brains into gear, stop ripping off UK bingo clubs and other gambling establishments. This has resulted in so many sites closing in recent years and job being made redundant and then reform the tax structure so that all companies that take money from the UK residents pay the same tax. Then when you realise how much extra revenue you have you might not have to make such harsh cuts in the rest of the economy. The sooner you act, the sooner UK companies will benefit, the UK residents will benefit and the economy will benefit. It’s not rocket science and given how many MP’s are able to see the benefits of scamming their expenses between you should be able to see the benefits of reforming gaming taxes to include offshore gaming”.

Yes the government is awaiting further studies and is expected to look at legislation for offshore gaming but why has it taken so long? Has the coalition government not justified the hardship the public have faced and will indeed face for many years ahead on the fact that we need to cut the national debt for a better future. Why therefore have so many other nationals already addressed the issue of offshore gaming operators yet the UK government has clearly turned a blind eye on the issue even in the face of massive criticism from UK based operators?

Betfair has been paying 15% in gross profits tax and will benefit from paying just 1% from today. It will continue to employ around 1200 people in offices in the UK but has confirmed that key technical equipment and 120 staff will move to the new offices in Gibraltar and Dublin. In the year to April 2012 the company expects to see £10 million in savings will annual savings of £20 million the following years as the full benefits are realised.

David Yu, Chief Executive Officer at Betfair claimed: “As a global, technology-led betting operator, our new operational base in Ireland and the change to our licensing structure provides us with increased flexibility. It allows us to locate key technical equipment in more efficient locations, to serve our customers better and to compete on the same basis as the majority of operators in the UK online betting market.”