William Hill offshore move on horizon, boss hints

William Hill chief executive Ralph Topping today dropped his strongest hint yet that the British bookmaker would be moving its telephone and internet operations offshore, citing competitive pressures from low-tax operators such as Ireland’s Paddy Power and Gibraltar-headquartered Bwin.

“We face worldwide competition from 400 or so English-language betting websites. In these circumstances, clearly we do not have the luxury of being parochial about our future or taking a simplistic stance on complicated issues,” Topping told the Financial Times yesterday.

Although UK bookmakers managed to head off a 2% rise in gross profits tax in April’s budget by demonstrating that the tax could result in the closure of 845 betting shops and the relocation of parts of their businesses offshore, Topping suggested William Hill could no longer bear the burden of a 15% tax, when rivals such as Paddy Power were paying just 1.5% in Ireland.

Topping said the competitive pressures it found itself under were behind the bookmaker’s decision to close 20 betting shops in the UK this year and to freeze the pay of 16,000 staff.

According to figures released by the Racecourse Owners Association, the UK government could stand to lose up to £45m a year in taxation if the three leading UK bookmakers, William Hill, Ladbrokes and Coral, relocated their online and telephone businesses offshore.

In a statement, the Treasury and the culture department told the paper they would be “very disappointed” if bookmakers such as William Hill moved offshore, and that it was reviewing remote gambling rules to ensure a more level playing field between British betting businesses and their offshore competitors. As reported on EGRmagazine.com, these could include major levies for foreign gambling firms.

For more on William Hill, see our interview with William Hill Online CEO Henry Birch.