Monthly Archives: May 2016

Betting on Brexit


Playing the financial markets like the game of blackjack is a skilled and calculated form of gambling. It is no wonder then that the UK’s major bookmakers include a number of financial and often political bets within their spreads.

One subject of debate in both the financial and gambling markets is the withdrawal of the United Kingdom from the European Union, also known as Brexit (British Exit). Various financial institutions are offering clients the option to insure against Brexit losses caused by currency depreciation should the UK take the decision to exit the European Union. According to financial experts, the Pound will drop approximately 20% to the Euro should the UK exit the EU. Furthermore economic decline and falling stock prices are also expected should the exit decision be made and along with these there are of course rumours of recession and war being whispered in certain circles.

For those invested in the markets, insurance options may not seem like such a bad idea in an attempt to hedge bets and cover any losses that may be incurred should the Brexit take place. Of course, this cover like any other form of insurance cover does come at a price. In deciding whether or not to take the option investors have to examine their portfolios in order to ascertain whether or not they can realistically weather such an event or not, without the aid of some type of insurance.

Brexit bettingBetting odds on Brexit are being offered by a number of the UK’s major bookies with betting and polls favouring the UK remaining in the EU

The financial industry is not the only party interested in the outcomes of Brexit. British bookmakers like Betfair are offering odds on Brexit too, with 15 million Pounds matched on the market to date. This means that as an investor instead of selling your British currency or buying stock put options, if you’re a true gambler, you could also spend your money at the bookies with the potential to earn 5.5 times the money back if the UK votes to leave the EU. Talk about an insurance policy!

The latest polls and betting options do however favour the Britons voting to “remain” in the EU come election time on June 23rd. In fact, Betfair punters are so convinced that the UK will remain a member of the EU that Remain odds are down to 1.21, the lowest price yet with Leave coming in at 5.5 in the most recent numbers. The polls are also in tune with the betting, with Ipsos MORI and ComRes both giving Remain leads of over 10% and YouGov’s latest echoing these sentiments.

Yet the issue remains a passionate point of debate with proponents from each side vigorously arguing their case. With just under a month to go until Britons return to the polls it will remain a very interesting topic to follow.

The end of Free Spins Promotions in the UK?

The UK was one of the first countries in the world to license and regulate online gambling. But that has meant that casino operators have been subject to a great deal of scrutiny and have had to comply with numerous legal obligations.

One of the most recent revisions of the UK’s gambling tax laws is the institution of the Point of Consumption tax for online gambling, and as the lawmakers are tightening the bonds in this area, the use of Free Spins as a promotional and loyalty reward for slots players may be a thing of the past…

This is due to the fact that Chancellor George Osborne stated in his speech earlier this year that from August 2017 online casino and bingo operators would be liable for tax on free play offers. This is being done in order to ensure the same level of compliance in online gambling that sportsbooks and the race betting industries are already subject to when it comes to discounted and/or free wagering under the General Betting Duty. This point was later confirmed in a budget document.

Implementing these changes is set to cost the UK government a considerable £20 million, but it will be money well spent if the projected tax revenue of £110 million in 5 years’ time comes to fruition.

These earnings do however depend on online casino licensees continuing to offer free spin promotions at the current level. This however is highly unlikely given the fact that they are already facing increased pressure to their bottom lines in complying with licensing and tax liabilities in the various markets, overheads which have been added in addition to their annual licensing fees paid to various software providers who power their casino games and platforms and staff costs in recent years.