The betting exchange section of William Hill’s new policy paper, ‘Betting on Britain’, (reported in Friday’s Racing Post, and now doing the rounds of an MP’s office near you) is Shakespearean in its range: comedy, history, tragedy, and not a little irony. It’s all there.
The history part is obvious, and tied in with it is the document’s tragedy. It is not the first time William Hill (or another big bookmaker) has launched an attack on our business based on the absurd claim that Betfair customers are ‘acting as bookmakers’ and either we, or they, should be singled out for differential tax treatment accordingly; and it probably won’t be the last. From my perspective, it’s refreshing that there is nothing in their attacks which is new, and nothing that is not easy to knock down with the smallest level of scrutiny. But as readers of this blog will know, I think it means William Hill are living in the past, and it’s about time we got onto a sensible topic. Like previous efforts, the document is an attempt to stifle competition in a modern market. And like the previous attempts, it’ll be rejected by anyone with a brain.
The irony? Well, it’s a paper which argues for a change in tax treatment on the grounds that tax is somehow being avoided. William Hill pay no tax on their online business since moving it offshore last year. Need more be said?
As for the comedy: there’s almost too much of it to mention, such as the table – labelled ‘a simplified version’ (see irony, above) – in which they genuinely try to argue that they pay tax based on one customer losing £1000 to them (without any suggestion that at the same time, another customer will win £850 and it’s the difference between one and the other that constitutes the profit, not the £1000 on its own (although even that is a simplified version); for tedious amounts of more of which, click here or here, or, in even more detail, here).
But the best line in a whole gamut of them has to be the one that says that taxing exchanges at a higher rate of gross profits tax on their commission is an “appropriate alternative” if identifying individual exchange users for tax purposes proves “too difficult”.
This basically translates as “we think, without any evidence, that there are bookmakers who are evading tax that are using exchanges, but it is far too hard to say exactly which of Betfair’s punters are doing so [presumably this will be because it's not true, a bit like trying to prove the existence of ghosts], so the best course is to subject exchanges to a discriminatory tax regime just in case.”
Why they don’t just write, “the sole objective of this paper is to try to argue that you should tax or regulate (or both) those horribly competitive betting exchanges to such an extent that they are unable any more to offer their product and offer stiff competition to William Hill and other traditional bookmakers (which we still aren’t really used to and don’t like much), even though we can’t actually articulate any justification for doing so, or provide any evidence that it is necessary.”
Surely it would have been rather more transparent and honest if they had? Or is that a third piece of irony lost on no-one but themselves?