Sky Bet’s move to Malta has sparked a fresh political debate in the UK, with former prime minister Gordon Brown urging MPs to examine whether gambling companies are using relocation strategies to reduce their tax obligations in the UK. Brown released a sharply worded statement, following revelations that Flutter Entertainment, Sky Bet’s parent company, could save tens of millions of pounds each year after the move.
Gambling Taxation Remains a Contentious Issue
Sky Bet is not leaving Britain entirely. The company is adamant that the move is part of a larger restructuring rather than an attempt to leave the UK market, pointing to its Leeds office, which will remain one of its most significant strongholds in Europe. However, the move’s timing has caused unease among UK lawmakers, who are weighing potential tax increases for the gambling industry.
Proponents for higher taxes claim that gambling operators, particularly online platforms, should shoulder more responsibility for the social harms associated with their products. On the other hand, the industry stakeholders argue that higher taxes would drive consumers to unregulated offshore markets.
The financial aspect of Sky Bet’s move has further escalated the debate. According to Dan Neidle, a tax expert speaking for ITV News, shifting the headquarters could reduce the company’s corporation tax bill by as much as GBP 31 million ($40.53 million) annually. However, he warned that changes in UK tax regulations or disputes by revenue authorities could carry significant risks.
Sky Bet’s Move Could Invite Increased Scrutiny
The Treasury Select Committee is reportedly investigating the taxation of betting and gaming firms ahead of next week’s Budget. Brown now wants lawmakers to examine transfer pricing arrangements, potential avoidance structures, and what Neidle described as a VAT loophole that could reduce the tax payable on Sky Bet’s marketing costs by an estimated GBP 24 million ($31.4 million).
Meanwhile, SkyBet reportedly acknowledged that the move could have some tax implications. However, the company stressed that Flutter remains one of the UK’s largest taxpayers. A company spokesperson stated that the business regularly reviews the structure of its international operations to stay competitive and ensure compliance in all active jurisdictions.
As with most global businesses, we are constantly striving to remain competitive and efficient and to give ourselves the best chance of success in an incredibly challenging environment.
Flutter Entertainment statement
It is uncertain whether Parliament will accept these justifications. Britain’s online betting industry is recording record revenues of over GBP 7 billion ($9.15 billion) per year, increasing frustration among the MPs who think the current tax system is too easily manipulated. With a Budget drawing near and a general review of gambling regulation already taking place, Sky Bet’s position remains uncertain.