Online poker in the UK to face reform

[Solaris]

If the Government tried to tax individual punters for online poker winnings, would it have to be recognised as a skill game for that to happen? Surely you can't tax people on a game of chance?

Do agree with a lot of posts in here, particularly from the likes of vegaslover.

Don't really understand your logic here.  Most countries tax lottery winners for example.

Isn't that because the state is in charge of the lottery?

[AlunB]

There have been no Cabinet level discussions regarding taxing poker winnings since the new Govt came into operation. This from, ahem, a senior govt source about a month ago.

I was talking purely theoretically. In the sense that it is possible. But yeah I think it's very unlikely.

It's interesting though that when the US government talked about raising $x gazillion dollars in tax revenue, when you looked at the study most of that was from the players paying taxes.

[kinboshi]

There have been no Cabinet level discussions regarding taxing poker winnings since the new Govt came into operation. This from, ahem, a senior govt source about a month ago.

Did you hack his phone?  You don't work for News Int. do you ?

[Somerled]

There have been no Cabinet level discussions regarding taxing poker winnings since the new Govt came into operation. This from, ahem, a senior govt source about a month ago.

Did you hack his phone?  You don't work for News Int. do you ?

  Nah, just met him and asked him. Taat's the old fashioned way to get information. 

[Simon Galloway]

If the govt wished to individually tax winning gamblers, they would have to create an entirely new form of tax.  So this would mean drafting legislation, getting parliamentary time, setting up admin systems and ongoing admin.  All for an unreliable and unquantifiable income stream.

Wouldn't it be easier for them (if indeed they go down this route) to reclassify gambling as a tax assessable form of income?

[doubleup]

If the govt wished to individually tax winning gamblers, they would have to create an entirely new form of tax.  So this would mean drafting legislation, getting parliamentary time, setting up admin systems and ongoing admin.  All for an unreliable and unquantifiable income stream.

Wouldn't it be easier for them (if indeed they go down this route) to reclassify gambling as a tax assessable form of income?

"reclassify" - when did they classify and unclassify? /nit

They have to create a new tax schedule that has to go through parliament, they can't just decide to do it.

[redarmi]

Isn't that because the state is in charge of the lottery?
[/quote]

Not really.  By way of another example bingo winnings, roulette winnings and slot wins are taxed in most countries over a certain level.  None are games of skill although claw might want to argue that point.

[redsimon]

If the govt wished to individually tax winning gamblers, they would have to create an entirely new form of tax.  So this would mean drafting legislation, getting parliamentary time, setting up admin systems and ongoing admin.  All for an unreliable and unquantifiable income stream.

Wouldn't it be easier for them (if indeed they go down this route) to reclassify gambling as a tax assessable form of income?

"reclassify" - when did they classify and unclassify? /nit

They have to create a new tax schedule that has to go through parliament, they can't just decide to do it.

Could tax under schedule D quite easily, though their clear problem would be quantifying profit loss and what losses could be utilised.

Schedule D (tax on trading income, income from professions and vocations, interest, overseas income and casual income)

[AlexMartin]

In fact why are we even lobbying for more tax.  It just gets p*ssed up the walls by politicians on vanity projects and the usual imbeciles that inhabit the local councils.

very much this! gambling for a living is an incredibly unreliable source of employment for 85% of full-timers. Pay tax on huge wins, forget the rest imo. A full-timer can go broke very easily (even many times), with no gauranteed income. Sod tax.

[doubleup]

If the govt wished to individually tax winning gamblers, they would have to create an entirely new form of tax.  So this would mean drafting legislation, getting parliamentary time, setting up admin systems and ongoing admin.  All for an unreliable and unquantifiable income stream.

Wouldn't it be easier for them (if indeed they go down this route) to reclassify gambling as a tax assessable form of income?

"reclassify" - when did they classify and unclassify? /nit

They have to create a new tax schedule that has to go through parliament, they can't just decide to do it.

Could tax under schedule D quite easily, though their clear problem would be quantifying profit loss and what losses could be utilised.

Schedule D (tax on trading income, income from professions and vocations, interest, overseas income and casual income)

errr that is exactly the schedule that the courts ruled does not cover the earnings of a winning gambler.  They stated that a winning gambler was not in a trade profession or vocation.

Judges aren't stupid when considering these decisions.  You just need to compare a bookmakers strategy in a horserace to a punters (ignoring "cheating strategies").  The bookmaker will offer short odds and try to minimise liabilities and will always be able to prove that there is a mathematical edge, the punter will only be able to say I think this horse is overpriced. 

The "winning" punter only becomes apparent after a long period of success and his success could still be variance.  Even if a bookmaker loses on a day or longer, his strategy should still be mathematically sound.  The bookmaker is obviously carrying out a trade and will be able to apply his method to every race, the winning gambler can't prove they have a strategy that will consistently lead to profits and can only bet when he thinks the odds are (unprovably) in their favour. 

Poker has plenty of variance and winning players have either been lucky or have played consistently against inferior players.  The internet has increased the opportunity to find inferior players, but finding them is becoming harder and no one has a strategy that is profitable and inexploitable.  So there isn't much difference between the pokerplayer and the horse punter. 

[strak33]

I have never really understood why professional gamblers think they should be exempt from contributing to society by paying taxes anyway. 

Very much this.

Very much not this. Struggle to beat the rake.

that's OK, we were talking about winning players. If you're struggling to beat the rake you're not a winning player (unless rakeback means you are profitable, in which case you should pay tax..assuming you make more than your tax-free allowance)

Rightttt ok then.

I will be alrite

[DungBeetle]

"Schedule D (tax on trading income, income from professions and vocations, interest, overseas income and casual income)"

I think there is case law on this which have set precedents which means they can't?  They'd have to put through a completely new tax to do it.

[redsimon]

If the govt wished to individually tax winning gamblers, they would have to create an entirely new form of tax.  So this would mean drafting legislation, getting parliamentary time, setting up admin systems and ongoing admin.  All for an unreliable and unquantifiable income stream.

Wouldn't it be easier for them (if indeed they go down this route) to reclassify gambling as a tax assessable form of income?

"reclassify" - when did they classify and unclassify? /nit

They have to create a new tax schedule that has to go through parliament, they can't just decide to do it.

Could tax under schedule D quite easily, though their clear problem would be quantifying profit loss and what losses could be utilised.

Schedule D (tax on trading income, income from professions and vocations, interest, overseas income and casual income)

errr that is exactly the schedule that the courts ruled does not cover the earnings of a winning gambler.  They stated that a winning gambler was not in a trade profession or vocation.

Judges aren't stupid when considering these decisions.  You just need to compare a bookmakers strategy in a horserace to a punters (ignoring "cheating strategies").  The bookmaker will offer short odds and try to minimise liabilities and will always be able to prove that there is a mathematical edge, the punter will only be able to say I think this horse is overpriced. 

The "winning" punter only becomes apparent after a long period of success and his success could still be variance.  Even if a bookmaker loses on a day or longer, his strategy should still be mathematically sound.  The bookmaker is obviously carrying out a trade and will be able to apply his method to every race, the winning gambler can't prove they have a strategy that will consistently lead to profits and can only bet when he thinks the odds are (unprovably) in their favour. 

Poker has plenty of variance and winning players have either been lucky or have played consistently against inferior players.  The internet has increased the opportunity to find inferior players, but finding them is becoming harder and no one has a strategy that is profitable and inexploitable.  So there isn't much difference between the pokerplayer and the horse punter. 

You might want to check some of the tax commissioners decisions (Not the Courts btw). It can also be possible for a card player to be taxed on winnings from one of those decisions, if they also play in an event they organise. Most of the tax decisions were made decades ago and it could be possible for the Government to look into taxing winnings, without giving relief for losses to the small scale players with professional players taxed as a vocation or trade. The steer from HMRC recently has been to concentrate less on Large Corporations and aim at small/ medium sized businesses.

Whether anything will come of it or not is moot. Personally  I think its a long way away, but not impossible.

[DMorgan]

Irrespective of whether people think its fair or not there are just so few professional players in the UK that sodding about making legislative change so that they can come and get us would probably be way more trouble than its worth

Strictly online players I guess you can argue against but the live guys ship some to the IR, it just goes down the slot on its way there

[DaveShoelace]

The majority of the stuff coming from the Culture secretaries office has been much more about not letting operators not on the UK white list to advertise in this country without paying a premium, not much about actually taxing punters or existing white listed operators. It will probably come up too, I think ultimately that's the way this is headed, but right now its much more about regulating overseas operators and the advertising.

Not sure I quite understand this. Companies not on the white list can't advertise in the UK, that's the whole point of the white list isn't it? Or have I misunderstood what you're trying to say.

Personally I think as someone noted above the main impetus for this was France and Italy making the UK look a bit daft and outdated in their approach to regulation. Nobody of any significance has even applied for a UK licence. Why bother when it gives you no advantage? So of course they are miising out on a load of lovely tax revenue. Mmmmm tax.

Sorry I was a bit sleepy eyed this morning I, I wrote advertise when I meant operate. My understanding is that they want to charge operators not on the white list, possibly through the payment processors, for having UK custom. They also want to have a hand in regulating those currently on the white list, as they currently allow them to advertise while having no influence on how they are regulated.

This was all pre black friday, however, I can only assume that their line will be much tougher now.

This is what I was getting at, announced yesterday, plans for an offshore betting tax

http://www.telegraph.co.uk/sport/horseracing/8636182/Government-to-announce-new-offshore-betting-tax.html