The Isle of Man's Online Gambling Regulation Act, having received royal ascent May 15, is well on its way to enactment.
The next stop is a procedural step: The bill will be laid before Tynwald, at which time the enforcement date of June 21 will be set. (Tynwald is when both the House of Keys and the Legislative Council meet.)
The government will almost immediately begin accepting applications for the three available licenses, which are likely to be issued by August, according to Julian Lalor-Smith, the administrator for gambling services in the Department of Home Affairs. Should the government wish to increase the number of licenses, he added, it would be a simple process that takes only 10 days.
Potential licensees will pay a license fee of £80,000 annually, while application fees will be £1,000.
In preparation for laying the bill before Tynwald, the Isle of Man Treasury has introduced two statutory orders regarding gambling taxation issues. For all betting duties, except for the National Lottery, the taxes collected for gambling will be based upon a percentage of gross yield, to be calculated using a similar model to the one being introduced in Great Britain.
"By taking appropriate and prompt action now," said Treasury Minister Richard Corkill MHK, "we have removed the uncertainty attached to the future of Island-based businesses operating gaming on the Internet. We have also on behalf of the betting industry maintained a competitive environment for all bookmakers licensed and situated in the Isle of Man."
The first order would make provisions for an online gambling duty, which will be based upon gross gaming yield and will be set at 2.5 percent. Duty fees would apply to all bets, regardless of where the player is located.
The second order would change the general betting duty and is considered an intermediate step while consideration is given to the recent betting duty change in England. The order would reduce the current rate of duty, which is based on the percentage of the actual wager or winnings from 6 percent to 2 percent. The rate change would be roughly the equivalent to a 10 percent rate based on gross yield. Taxes on international bets would remain 0.3 percent of the amount staked. The rates would apply to online, telephone and traditional bookmaking activities.
Corkill added, "We note that the United Kingdom has indicated its intention to reduce its betting duty rates by more than half by the end of the year. In the Isle of Man, the Treasury has considered its position and decided that there is no reason for island residents to wait any longer."
Online gambling regulations are currently being developed and will likely surface in early June.