|Sportingbet, the Internet bookmaker, has postponed plans to launch an online betting exchange after the UK government announced a review of tax on betting exchange punters. |
Sportingbet had been trialling its own exchange, but has put off plans to launch the product after the UK treasury announced that the way exchanges are taxed is to be reviewed. UK Customs & Excise will conduct the review, which will determine whether all punters, or just those that lay bets, should pay tax on their winnings.
Mark Blandford, the founder and deputy chairman of Sportingbet, hoped for a swift conclusion to the review. 'We have trialled an exchange and in light of the Budget statement we have put that on hold,' he said. 'I would be very disappointed if this dragged on into next year, because we want clarity in terms of competition.'
Betting exchanges allow punters to “lay” bets, whereby they offer prices for a team, individual or a horse to win to other punters. So the layer can bet on a loss, rather than a win, drawing criticism that this undermines the integrity of the sport in question. Horse racing in the UK in particular has been in the spotlight due to concerns of suspected race-fixing, with betting exchanges mentioned in reports as having seen suspicious betting patterns.
High street bookies argue that betting exchanges effectively provide the means for punters to become bookmakers, therefore heavy layers should be licensed and taxed as bookmakers.
Betfair, the London-based betting exchange, has about 90 per cent of the UK exchange betting market, with a weekly turnover thought to be in the region of £50m from a user base of 200,000. Other exchanges include Betdaq, Sporting Options and BackAndLay.
Sportingbet was the first UK company with tax-free online betting, and has since expanded into online casinos.