RANK THINKING ABOUT AN OFFSHORE MOVE?

13 July 2007

CEO newspaper interview reveals some interesting plans

Quite apart from showing what a long and hectic business day the CEO of the UK Rank group routinely has to contend with, an article in the Independent newspaper this week reveals that the company, which includes the popular online betting site Blue Square.com, may be considering a move offshore following unpleasant taxation surprises in Britain.

Rank CEO Ian Burke (50) told the newspaper he is considering moving the company's Blue Square betting operation offshore in order to avoid the 15 percent gross profits tax placed on UK-based remote betting operations. The then Chancellor Gordon Brown increased the duty on casinos from a sliding scale of 2.5 to 40 percent to between 15 and 50 percent in the 2007 Budget. The sharp tax rise would have shaved GBP 8 million or 20 percent from Rank's casino operating profit if it had been implemented in 2006.

Burke said: "It is something we would consider, but we have not made a decision yet."

"Our argument is that we don't make super profits but it is a super tax," he added. "It will have an impact on how much investment we make in the UK and on the 17 new casino licences the Government wants to award. The economics now means some may not go ahead."

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