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Isle of Man

What is the ‘Isle of Man’?

The Isle of Man is a small island nation located to the west of the British Isles (between the UK and Northern Island). It does not form part of the United Kingdom but is instead a crown dependency with independent governing status and the Queen as its head of state. The island is home to a number of offshore gambling operations which are based there for tax purposes but which offer their services to players back in the UK.

The ‘Isle of Man’ Explained

Under the terms of the Gambling Act 2005, any form of gambling which takes place in the United Kingdom is subject to a number of financial regulations, restrictions and taxes which are designed to keep play fair and to ensure that the gambling industry is contributing to the economy.

However, tax and law loopholes allow gambling companies to base themselves offshore and still provide their games in the UK. This means that the business can take advantage of favourable local tax rates in other European nations, but pursue the larger and more desirable British market – one of the world’s largest gambling industries.

The Isle of Man is one such jurisdiction. The taxes for gambling services on this island, which neighbours the UK but is independent of it in administrative terms, are much lower. Gambling is an important part of the national economy on the Isle of Man, and hosting these gaming countries has a significant impact on the island’s finances.

However, amendments to the British gambling law in 2014 might change this offshore trend. As well as paying local taxes, gambling operations which serve UK players will be subject to a tax on their earnings. This could raise the costs of being based in another nation and make the UK a cheaper alternative once again.