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On the face of it, the online gambling market in the UK appears to be in rude health as we approach the end of 2018. After all, this sector generated a gross gaming yield (GGY) of £4.7 billion in the year ending September 2017, while the market grew by 10.1% in relation to the previous 12 months’ figures.

Despite these largely unprecedented levels of growth, however, there’s no doubt that this market faces a number of considerable challenges in the near-term. From potential political changes to the UK Gambling Commission’s (UKGC’s) core strategic objectives through 2021, the market will come under increased pressure over the course of the next 12 months and beyond.

In the article below, we’ll consider some of these challenges in further detail while appraising the impact that they’re likely to have on the virtual gambling industry in the UK.

May 30, 2019 The United Kingdom Gambling Commission has published its latest statistics on each sector that it regulates, revealing that online continues to go from strength to strength within the region. Bringing in a gross gambling yield of. The online gambling sector in the UK continues to change at a rapid pace, but what challenges is it likely to face in the coming year? DE ES RO DK CA Best Casino Bonuses.

Potential Shifts in the Economic Political Landscape

We’ve previously spoken in this blog about the looming spectre of Brexit, with the UK set to exit the European Union on March 29th, 2019.

However, the recent negotiations have been hampered as the harsh realities of Brexit have been laid bare, with likelihood of a no-deal exit becoming more realistic with every passing day.

This could prove particularly challenging for the online gambling market in the UK, with the long-term future of key jurisdictions like Gibraltar yet to be determined. So although the UK government has eased some industry concerns by negotiating a temporary deal that will enable Gibraltar to maintain access to the single market until 2020, further work needs to be undertaken if gambling industry is to avoid sustained and widespread disruption.

The primary concern here is that British operators may no longer see the benefit of basing themselves in the UK or Gibraltar, with the latter’s status as a tax haven for gambling firms not enough to compensate for restricted access to the single market. After all, jurisdictions like Malta offer similarly low tax rates and relaxed regulations, while this country will also remain a member of the single market into the future.

Of course, we’ll know far more about Brexit and the course that it’s likely to take by the summer of 2019, by which time British operators will have a clearer understanding of how exiting the EU will impact on their business.

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However, this challenging climate could well be exacerbated by potential tax hikes in the online gambling sector in the UK, which have been proposed by the government ahead of the high profile FOBT machine stake reduction.

Following an investigation by the government department for Digital, Culture, Media and Sport earlier this year, it was revealed that the maximum betting threshold for FOBT’s would be slashed from £100 to just £2. Following subsequent lobbying from successful operators and betting leadership, however, the government has agreed to an extended transition period that will delay the implementation of this measure until April 2020.

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Not only has this courted considerable controversy, but the delay is also likely to have an indirect impact on the virtual gambling sector. More specifically, the Treasury is expected to impose a higher tax rate on operators within this market, with an increase to the existing Gaming Duty expected to be unveiled as part of the April 2019 budget.

So while this is expected to offset the future loss of tax revenues through reduced FOBT wagering, it’s timing will also coincide with the UK’s departure from the EU. These factors could combine to have a considerable impact on the UK market, testing the resolve of some operators to remain based on these shores in the process.

This volatile economic and political climate raises other potential issues too, not least the prospect of a snap general election being called at some point during 2019.

After all, there is already considerable pressure being placed on Theresa May’s leadership and the composition of her government, and further tumult either pre or post-Brexit could well trigger a new election in the UK.

The election of a Labour government could well follow given the social divisions that currently exist in the UK, but this would not necessarily be good news for the online gambling sector.

After all, Labour have vehemently opposed various aspects of the online gambling market in recent times, with deputy leader Tom Watson having suggested that rampant advertising and problem wagering represent a “public health emergency” that must be urgently addressed.

While the Conservatives have responded by claiming that it was Tony Blair’s Labour government that first liberalised the gambling market when it was in power during the noughties, this should not distract from the hard line that the party would take if it was to be elected at some point during the next 18 months.

On the issue of problem gaming, a recent report commissioned by Labour found that there were 430,000 identified gambling addicts in the UK. Incredibly, an estimated 25,000 of this number were thought to be 16 or under (we’ll have more on this later), and the party has responded with a number of potential measures to tackle this problem.

One of the measures would prevent people from using debit cards to pay for bets when gambling online, while Labour would also introduce a levy on operators to pay for the treatment of self-declared addicts.

At present, there is a voluntary levy of this type applied to gambling operators in the UK, which currently generates around £10 million per year. Under Labour’s proposed plans, however, a compulsory charge would amount to 1% of operators’ GGY and yield an