Gambling companies in the Isle of Man will be hit by the six percentage point increase in remote gaming duty.

Non-UK gaming operators with UK customers will be affected by the increase in tax to 21%.

Chancellor Philip Hammond said in his Budget spech that the rise in the so-called remote gaming duty would compensate for loss of revenues from the UK government’s announcement in the summer that it would crack down on fixed odds betting terminals. The eGaming industry in the island accounts for 18% of the island’s economy.

Island gambling expert Warwick Barlett told the Manx Independent that the companies affected will be offering online games such as poker, blackjack and casino games.

It does not affect firms with sportsbook offering such as horse racing.

Mr Bartlett, founder and chief executive of Castletown based Global Betting and Gaming Consultants, said: ’I think the industry expected that the duty increase would reflect the off course Machine Games Duty [MGD] rate at 25% so there was a slight sigh of relief when 21 per cent was announced.

’However, I expect it will raise between £225m to £250m in a full year.

’The UK remains a competitive market so mitigation will not be easy, although it is easier to build margin in casino products as opposed to sports betting. This comes on top of a lot of damaging regulation and compliance that has seen operators having to change their business models to something worse rather than enhancing profitability.

’It has been suggested this will cause further consolidation, but there is a limit to how far that will go and we have already seen quite a lot already.

’Off shore jurisdictions in the Caribbean for start-ups, and smaller operators have suddenly become more attractive. Had the rate moved to 25% such operators would have been a serious threat to the UK market.’