Gambling companies in the UK will become subject to a new levy that is set to be unveiled by the Government’s economic and finance ministry.
Recently, the UK Treasury has confirmed plans to bolster the country’s fight against economic crime by the implementation of a new levy on companies that are subject to anti-money laundering (AML) regulations. As unveiled in draft legislation published last month, firms that are liable to the Money Laundering, Terrorist Financing and Transfer of Funds Regulations of 2017 will be required to pay a fixed fee on an annual basis. The first levy payment will be due over the year from April 1st, 2023 to March 31st, 2024.
As revealed by some analysts, in some cases, the cost of the annual fixed fee will represent a considerable portion of the money used by a company to guarantee compliance to financial crime and anti-money laundering legislation.
Alongside the above-mentioned draft legislation, the UK Treasury also published its response to a consultation regarding the proposed levy’s design. A short technical consultation on the draft legislation’s contents that is set to close after October 2021 has been published by the Treasury, too.
The consultation’s respondents agreed that the UK Government had to take measures to respond to economic crime. Furthermore, they agreed that when designing the new fixed fee, the authorities need to take into consideration a number of key principles, including proportionality, cost-effectiveness, simplicity and predictability.
UK Gambling Commission to Be among Regulators to Collect the New Levy
Companies operating in different economic sectors, including gambling services, will be subject to the new levy, with the fixed fee set to be imposed in four bands depending on how big the regulated firm is.
Small companies that generate UK revenue of less than £10.2 million will be exempt from the new levy. Operators that generate UK revenue in the range from £10.2 million and £36 million will be subject to a proposed tax from £5,000 to £15,000 over the first year, while larger companies that generate between £36 million and £1 billion in UK revenue will face a levy of between £30,000 and £50,000. Operators whose UK revenue exceeds £1 billion will be subject to a levy in the range from £150,000 to £250,000 in the first year.
When the proposed legislation is finalised, the aforementioned ranges are set to be replaced with a single figure for each band.
As revealed by the UK Treasury, the levy is set to be collected by a number of regulatory bodies, including the HM Revenue and Customs, the UK Gambling Commission (UKGC), and the Financial Conduct Authority (FCA).
According to some experts, the proposed levy ranges are surprisingly high. David Hamilton, a white-collar crime expert from Pinset Masons, explained that in some cases the cost of the levy would account for a considerable proportion of a company’s annual budget for anti-money laundering and financial crime compliance. Mr Hamilton shared expectations that the implementation of the new fixed fee is likely to have significant consequences for companies whose regulated activity accounts only for a small fraction of their overall revenue in the UK.
Olivia Cole has worked as a journalist for several years now. Over the last couple of years she has been engaged in writing about a number of industries and has developed an interest for the gambling market in the UK.