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Betting shakeup will target offshore bookmakers 14/07/2011
Press Association
Offshore betting operations would have to be licensed under government plans to help fund horse-racing industry

The government is to launch a crackdown on offshore betting which will mean bookmakers operating in Britain, including those based abroad, must be licensed by the Gambling Commission.

The heritage minister, John Penrose, said: "We are intending to move as fast as we can towards a system which will fix the problem of offshore betting.

"We plan to move to a system which will switch away from the current organisation which has driven many bookmakers offshore."

Speaking to MPs on Wednesday night, he said the revamped industry would be based on the point of consumption rather than production.

"It means anybody based anywhere in the world who wants to sell gambling services to any consumer based in the UK will, in future, have to have a Gambling Commission licence."

The Conservative MP Matthew Hancock had earlier called for bookmakers taking bets in Britain to be run from Britain so they funded horse racing through the betting levy, rather than being able to avoid it by being based offshore.

"We need a level playing field by ensuring all gambling in the UK pays UK tax and UK levy."

He warned that racing prize money was falling fast and jobs that relied on the "sport of kings" were at risk.

Opening the debate, Hancock said funding for horse racing had been in crisis for the past few years.

"The problem is in part because those who make a profit from the sport through the gambling on it have gone offshore to escape contributing to the sport on which they rely."

He hoped to put the sport which "gives so much excitement to so many people on an even keel so its funding is fair and secure for years to come".

Penrose agreed reform was needed.

"The levy as it currently stands is broken," he said. "It does not work and people on all sides – whether in the gambling industry or in racing – are pretty united in their criticism of it."

Penrose said the government's plans would be set out in a written ministerial statement on Thursday.