HMRC POC Consultation – Case Study
The approach taken by HMRC to such networks within their consultation on the Point of
Consumption tax shows a more considered appreciation of the need to ensure that a share
of the risk remains with the B2B operator.
Old / Expired Link
te_gambling_summary_of_responses.pdf
“3.36 Following the concerns raised by many operators surrounding the definition of
“provision of facilities”, the Government intends that the person liable for remote
gaming duty will be the person with whom the customer contracts or enters into
arrangements with for the gamble. While in the vast majority of cases this will be the
same person as the person who holds a Gambling Commission ROL[Remote
Operating Licence], the Government intends that ROL holders will also be made
joint and severally liable to duty where this is not the case. [My bold]
3.37 Some respondents raised concerns with the extension of joint and several
liability to members of a network, where a single gambling offering is provided by
two or more operators. In particular, they noted that operators would not always be
able to account for their partners’ duty liabilities, and that they should therefore not
be made liable in these circumstances.
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3.38 However,some operators responded that it would be highly unlikely that a
holder of a ROL would be unaware of dutiable profits. Some highlighted that, in
cases where tax liability is shared, for example between a customer-facing operator
and a service provider, there may be short periods during a commercial
“reconciliation period”, when profits or losses are settled,when the holder of a ROL
would not be aware of how much tax they would be liable to. Beyond the
reconciliation period, ROL holders would have full sight of the profits from the
offering, and therefore of their tax liability.
The Government’s response
3.39 The Government has taken respondents’ concerns into consideration and
intends that, as outlined in the consultation, joint and several liability will extend
to all those holding a ROL for a relevant remote gambling offering. Joint and
several liability will not extend to different companies who offer gambling as
part of a network, such as a single poker game with customers of different
operators, but who are not corporately affiliated.” [My Bold]
My understanding of this consultation outcome is that each B2B Poker network will be
jointly and severally liable for the tax due with each of their B2C partners. A B2C operator
will not however be jointly and severally liable for the tax due from a B2C on the same
network, as they have no contractual arrangement between themselves, they merely share
a Remote Operator Licence partner (the B2B network).
