Flutter Entertainment-owned Sky Bet has relocated its HQ to Malta in a move which could save the business up to £55m ($71.9m) annually on its tax bill.
The move comes at a time when Government budget plans may see land-based sports betting shops in the UK hit with taxes of up to 50%, with some operators, including Betfred, stating such a tax would force it to shut all high street operations.
Indeed, the UK Government is currently trying to find ways to increase tax revenue to fill gaps in its budget. Gambling companies have been a prime target of this; and with Flutter owning not just Sky Bet, but also Paddy Power, Betfair and Tombola, it is likely feeling the strain. 57 Paddy Power shops have already been set to shut - and the budget has not even been released yet.
Flutter made Sky Bet aware of the move in June, alongside its announcement of roughly 250 redundancies within the Sky Bet team. The move was described as necessary to reduce costs and operate more efficiently. According to Sky Betting and Gaming CCO Steve Birch, day-to-day operations of Sky Bet will take place in Malta from 1 November.
In a note to ITV News, a Flutter insider said: "Tax was the elephant in the room. It is absolutely understood, across everyone affected, indirectly or directly, or even aware of the announcement, that this is about tax. No one with a straight face would say it's 'for strategic reasons' or whatever other nonsense people come up with."
However, some have criticised the move. ITV News tax expert Dan Neidle said: "If I had been advising them, I'd say that it was reckless. The risk is that there's a lot of expense in moving people to Malta, and then they're stuck. And if the law changes [or] HMRC challenges their position, they could end up, in fact, saving nothing, but being stuck in Malta."
The impact of the move, ahead of the operator's full-year results, have yet to be seen.
Last year, Flutter delisted from the Irish stock exchange, and shifted its primary exchange from London to New York
