The Isle of Man has been an extremely popular location for gambling operators over the years as they have provided businesses within this particular sector with plenty of opportunities, advantages and benefits once established on the island, even given the current global climate.
Why is the Isle of Man so popular?
The Isle of Man was the first jurisdiction to introduce legislation aimed at regulating electronic gaming and gambling companies while providing statutory protections for online customers.
The Isle of Man is whitelisted by the British Gambling Commission, allowing those with an Isle of Man gambling license to advertise in the UK. The island also provides some political stability and an experienced labor force, which are all bonuses for the corporations working in the region.
Why is the Isle of Man a Favorable Location for Gambling Operators?
One of, if not the top, reasons as to why the Isle of Man is a favorable location for gambling operators is because of the tax laws in effect. Gambling operators are exempt from receiving certain taxes, whilst the environment is also advantageous to their business operations:
- Businesses have a simple and quick application process they need to follow to get established.
- There is a world-class infrastructure already available on the island.
- A diverse economy.
- A general “pro-business” environment.
Favorable tax rates and a system is always a positive draw, hence why so many gambling operators decide to operate from the Isle of Man. Their tax system has the following features:
- Zero rate corporation tax.
- No capital gains tax.
- Taxation of individuals – 10% lower rate, 20% higher rate, which is capped at a maximum of £125,000 per annum.
- No inheritance tax.
Gambling Operation Duty Fees
Gambling operations duty fees that need to be paid in the Isle of Man are extremely competitive, compared to the rest of the world; making the island even more popular. The duty payable on retained gross profits is:
- 1.5% for gross gaming yield not exceeding £20m per annum.
- 0.5% for gross gaming yield between £20m and £40m per annum.
- 0.1% for gross gaming yield exceeding £40m per annum.
The exception to the above is pool betting which carries a flat duty of 15%.
Regulation and Fund Separation
The online gaming sector is regulated by the Gambling Supervision Commission (GSC). Player funds are maintained separately from the operators’ funds to ensure that the players’ cash is protected. Therefore, providing everyone with a sense of safety.
IT Infrastructure and Support Services
The Isle of Man has an advanced telecommunications infrastructure, which is extremely important for gambling operators. The island has a very large bandwidth capacity and an extremely stable platform. The quality of staff that the industry needs is also of a high level, as many of them will already have extensive experience within the sector.
What is Required to Secure an Isle of Man Gambling License?
There are a number of obligations that need to be met for gambling operators to acquire a gambling license, including:
- The business is required to have a minimum of two company director’s resident in the Isle of Man.
- The business must be conducted by an Isle of Man incorporated company.
- The servers, where the bets are placed, must be hosted in the Isle of Man.
- Players must be registered on Isle of Man servers.
- Relevant banking must be carried out in the Isle of Man.
With relatively easy to meet standards and attractive tax relief laws related to the gambling industry, it is not difficult to see why the Isle of Man is a place where gambling operators are keen to do business.