Key Moments:
- Sky Bet began relocating commercial and marketing roles to Malta on 1 November.
- Flutter Entertainment denies tax motivation, citing strategic and operational efficiency as primary drivers.
- Reports indicated possible annual tax savings of around £55 million connected to the Malta move.
Strategic Relocation and Industry Environment
Sky Bet, one of the United Kingdom’s largest online betting brands, started transferring commercial and marketing positions to Malta on 1 November. Flutter Entertainment, which owns Sky Bet, maintains that this shift focuses on enhancing strategy, operational efficiency, and global competitiveness rather than pursuing tax advantages. The transition, however, has taken place alongside notable redundancies in the UK and increased examination of potential tax benefits resulting from operations being moved abroad, prompting questions regarding the underlying motivations.
Company Response and Justification
Reports from ITV News suggested that Sky Bet’s tax obligations could decrease significantly, referencing anonymous insights from within Flutter that “tax was the elephant in the room”. Flutter, however, informed SiGMA News that this assertion is inaccurate.
The company defended the move by highlighting mounting challenges within the UK’s gambling sector. Flutter identified government regulatory pressures, an escalation in illegal offshore operators targeting UK customers, and the risk of further tax increases as key difficulties.
A spokesperson commented: “Flutter paid more than £700 million in taxes to HMRC last year and we employ over 5,000 people across the UK including almost 2,000 in Leeds and 600 in Sunderland. As with most global businesses around the world, we are constantly striving to remain competitive and efficient and to give ourselves the best chance of success in an incredibly challenging environment.”
“The challenge we face is only made harder by the recent Gambling Act Review, the significant rise of illegal, unregulated black-market competitors and the possibility of tax rises in the Budget.”
Tax Implications Acknowledged
While acknowledging that tax impacts will result from the relocation, Flutter characterized these as secondary to broader business considerations. The company described completing the technology platform migration for Sky Bet this year before deciding to shift various roles to Malta, leveraging Flutter’s existing commercial center where over 750 staff are already based. The company stated: “This decision was made for a number of strategic and commercial reasons and will have some tax implications. But Flutter is committed to the UK and Sky Bet will continue to pay UK corporation tax on its profits.”
Flutter also maintains international operation sites in Porto and Cluj, both of which have absorbed some roles previously situated in Leeds, following the announcement of 250 redundancies in June.
Potential Tax Savings and Market Outlook
Speculation continues around the extent to which tax considerations influenced the decision. The Times of Malta referenced analysis by tax specialist Dan Neidle, estimating that relocating Sky Bet could save the business approximately £55 million yearly, factoring both corporate tax rates – with Malta’s effective rate around 5% versus the UK’s 25% – and value-added tax adjustments.
| Location | Effective Corporate Tax Rate | Potential Tax Savings |
|---|---|---|
| Malta | 5% | £55 million per year (estimate) |
| United Kingdom | 25% | – |
Expanding Global Presence and Recent Challenges
Flutter has further increased its international reach by moving its main stock market listing to New York, while keeping London as a secondary listing. The company identifies itself as the world’s largest sports betting and iGaming provider.
Internationally, Flutter has faced setbacks, most notably in the Asia-Pacific region following India’s unexpected total ban on real-money gaming, which resulted in a $556 million impairment charge.
- Author
Daniel Williams
