Many may not know about the gaming industry in the UK, but it is a very cherished sector of the Island’s economy.
The industry contributes billions to the national budget on a yearly basis, and some type of monetary damage to that source of revenue is definitely going to have long-lasting effects on the local economy.
Many speculate that Brexit will be the catalyst of change for the UK gambling industry, considering the fact that it covers quite a lot of exclaves as well. Currently, the UK prides itself for having one of the most reliable gaming regulations in the region and allows most of its local companies to cater to the wider EU population.
After Brexit though, all of that hard work of maintaining a lucrative industry can simply come crashing down on their heads.
The regulatory framework of the UK, as already mentioned is much more forgiving compared to its neighbors and future economic partners such as Norway, which, according to NorskeCasino, is notorious for having the strictest legislation on gaming in the region. Once Brexit officially takes place, some amendments will need to be made to the regulatory framework to better accommodate the shrunk market.
People may start seeing far fewer casinos that have just started out. In fact, it is going to be quite brutal for the operators themselves as, most likely, the taxes and license payments are going to increase.
Taxes and license payments
After Brexit, multiple UK industries are going to take a massive hit to their profitability, therefore the government will have to adjust the tax laws within the country. The less profitable industries such as gaming will have to take on a whole slew of the new tax regulations and cover up the losses of the more profitable ones.
The license payments are going to increase as less trustworthy jurisdictions are going to start vying for a position on the UK market. Because, remember, although the UK is a single country, it still has a large population of gamblers, which is always a gold-mine for any company.
Deals with Malta and the Isle of Man
New partnerships will have to be formed with Malta and the Isle of Man, which tend to accommodate UK players the most. Since the EU-wide regulation will not be the case anymore, both of the parties will have to compromise on what is accepted and what is not.
In most cases, it’s expected to have Malta regulated companies enter the UK market with relative ease, as the local government wants only the most trustworthy entities to cater to their population.
Furthermore, there’s the question of Gibraltar, which is now officially recognized as a part of the UK. If the UK leaves, then Gibraltar will have to follow.
The Gibraltar case
The only benefit that the gaming community will have in terms of Gibraltar is the potential increase in employee wages. Remember, almost 70% of people working in Gibraltar are from Spain, therefore they need to track back and forth on the borders, which could quickly rise up in costs. The thirty companies located on Gibraltar will have to either provide free transportation or increase the wages of their employees.
Although this is great news for the employees, it is devastating for the companies themselves. Increasing wages while also receiving fewer Spanish customers is going to be a massive hit to the local gaming market profitability. In fact, it’s supposed to be such a big hit that it may cause massive close-downs left right and center.
The overall outlook
What we can say in conclusion is that the gaming market is going to take a massive hit after Brexit. Companies located in the UK will have to scramble for the local market or find alternative methods with their neighbors. It’s not guaranteed that the UK and EU gaming regulations will match in terms of values.
The Gibraltar gaming scene may completely disappear due to rising prices and costs. There will be fewer new casinos in the UK controlled region and the remaining ones will have to compete on a completely different level for the 500 million potential customer base right across the English channel.