The offshore gaming industry, exemplified by big name operators who are licensed and regulated in European jurisdictions such as the United Kingdom, Spain, Italy, and Denmark, are successful companies because of ongoing investments made in product development, technology, fraud detection, and player protection. They have loyal customers that number in the tens of thousands (if not millions), massive liquidity, and employ some of the best and brightest minds in the high tech sector.

In Europe, paying tax in these individual jurisdictions is the cost of doing business in a regulated environment. In exchange for access to a country’s market via a license, operators and regulators agree on how much tax (Gross Gaming Revenue or Gross Profit Tax) will be paid. Taxation of offshore gambling can provide an important source of revenue for governments if it is properly designed—a point worth underscoring with Canadian provinces.

Offshore operators…it’s a taxing issue.