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V915 - Professional Gambling Taxation Bill (Second Reading) watch

  • View Poll Results: Should this bill be passed into law?
    As many are of the opinion, Aye
    54.35%
    On the contrary, No
    32.61%
    Abstain
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    B915 - Professional Gambling Taxation Bill (Second Reading), TSR Socialist Party


    Professional Gambling Taxation Bill 2016

    A Bill to apply income tax to professional gambling
    BE IT ENACTED by The Queen's most Excellent Majesty, by and with the advice and consent of the Commons in this present Parliament assembled, in accordance with the provisions of the Parliament Acts 1911 and 1949, and by the authority of the same, as follows:-

    1. Definitions
    The following definitions are used in this Act:
    1. A 'professional' or 'semi-professional' gambler is someone who plays a significant volume of gambling games which are capable of yielding a positive expectation (by any means which are both legal and permitted by the rules of the game) and who wins, or has a demonstrable expectation which is a sum of money which is not less than five thousand pounds.
    2. A volume of gambling games is 'significant' when it is capable of yielding a monetary expectation which is not less than five thousand pounds.
    3. A 'game' is something commonly done for recreation, and not commonly done professionally.
    4. A game is a 'gambling game' if the expectation of the players in each game, assuming mixed strategies are not used, is not necessarily equivalent to the actual result.
      a) For the avoidance of doubt, in this subsection, the latter use of the word 'game' refers to each iteration of the recreational activity - for instance, a hand of poker or blackjack.
    2. Taxation of professional gambling

    Those who gamble professionally or semi-professionally shall henceforth have income tax applied to their annual earnings.

    3. Multi-year tax adjustments
    1. Individuals shall be able to register as professional gamblers with HMRC, provided the following conditions are met:
      a) The individual paid at least £5,000 (five thousand pounds) in income tax on income accrued through gambling in the previous tax year;
      b) The sum of the individual's income from gambling in the current tax year does not exceed the sum of the entire previous tax year; and
      c) The individual does not have bets created which, if won, would cause subsection 3(1)(b) above to be satisfied.
    2. Where either or both latter two conditions in subsection (1) above are satisfied, or there is less than three months remaining of the tax year, the registration shall take effect only from the subsequent tax year.
    3. Registered professional gamblers' income tax will be calculated on the basis that the income derived from gambling over the previous period, as defined in subsection (4) below, had been equal each year, given the total gambling income before tax over that period. Examples of the operation of this subsection can be seen in Schedule 1 below.
    4. The "previous period" referred to in subsection (3) above is the greater of the following:
      a) The beginning of the first tax year in which the individual was a registered professional gambler; or
      b) Three years.
    5. Where a registered professional gambler also derives taxable income from other sources, the personal allowance to which they are entitled applies to gambling income ahead of other income.
    4. Offences
    1. It shall be an offence to do any of the following:
      a) Intentionally or recklessly apply to be registered as a professional gambler when the requisite conditions are not satisfied;
      b) While registered as a professional gambler, intentionally alter one's betting strategy to one which yields a lower expectation before tax, but yields a higher expectation net of tax.
      c) Claim refunds of tax paid in previous years through the mechanism in section 3 above when no longer gambling professionally or semi-professionally.
    2. The maximum penalty for any of the above shall be a fine of up to one million pounds (£1,000,000), and two years in prison.
      a) When calculating any fine, the sentencing judge should take into account the monetary expectation of the offence and the probability of being caught, and attempt to levy a fine which makes the individual slightly worse than indifferent to committing the offence, had they known the size of the fine prospectively.
    5. Commencement, Short Title and Extent
    1. This Act may be referred to as the Professional Gambling Taxation Act 2016
    2. This Act will extend to the United Kingdom; and;
    3. This Act shall come into force immediately
    Schedule 1 - Operation of multi-year tax calculations for registered professional gamblersThe following are examples of the operation of section 3(3) above. For mathematical ease, tax rates are treated as zero percent for up to ten thousand pounds (£10,000), twenty percent up to forty thousand pounds (£40,000), and forty percent after that.
    1. An individual who has been a registered professional gambler for the previous three years has gambling income of one hundred thousand pounds (£100,000) for the first two years, for which they paid income tax of thirty thousand pounds (£30,000) in each year, but in the third year has gambling income of only forty thousand pounds (£40,000). The average income over those three years would be eighty thousand pounds (£80,000), and thus the total sum due in income tax for those three years would be sixty-six thousand pounds (£66,000). Because sixty thousand pounds has already been paid, the total sum due in income tax in the third year is six thousand pounds (£6,000).
    2. An individual who has been a registered professional gambler for the previous three years has gambling income of fifty thousand pounds (£50,000) for the first two years, paying ten thousand pounds (£10,000) each year in tax, but in the third year, loses seventy thousand pounds (£70,000). The average annual income over those three years would be ten thousand pounds (£10,000). Because no tax is due on this sum, HMRC would refund the individual the tax paid of twenty thousand pounds (£20,000).
    3. The individual from example (2) above then has a year in which they win eighty thousand pounds. Their average income over the previous three years is now twenty thousand pounds. However, no tax has been paid for the previous two years effectively. Accordingly, the total sum of tax due is six thousand pounds (£6,000).
    Notes
    Spoiler:
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    Gambling income is not currently taxed in the UK[1]. This is unwise, considering professional gamblers in very few cases make a contribution through their profession to the economy or to society. This Bill amends that, while recognising (by way of section 3) that the income derived by professional gamblers may vary significantly from year to year, especially those who play higher-variance games professionally (for instance, tournament poker), and not penalising them for that fact.

    [1]Graham v Green - http://www.hmrc.gov.uk/manuals/bimmanual/bim22017.htm
    Changes for second reading
    Spoiler:
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    Removed references to a 'not insignificant' sum of money for clarity purposes. Also adjusted some fudged mathematics in Schedule 1.
    See first reading discussion here.
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    /copied from OP/
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    Aye - sounds goooood.

    DRINK!!!
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    Aye. I can't see any good argument against this - all it does is prevent some professions from being anomalously exempt from income tax.
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    Aye.
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    I believe this bill simply costs financially too much. Therefore, I have voted nay on this bill.
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    (Original post by Quamquam123)
    I believe this bill simply costs financially too much. Therefore, I have voted nay on this bill.
    It will cost to much by actually taxing them :confused:

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    (Original post by Quamquam123)
    I believe this bill simply costs financially too much. Therefore, I have voted nay on this bill.
    Sorry, what? There is no way this can cost money, given this delegates the actual collection method to HMRC, who will not pursue collection of taxes where it is -EV to do so.
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    (Original post by TheDefiniteArticle)
    Sorry, what? There is no way this can cost money, given this delegates the actual collection method to HMRC, who will not pursue collection of taxes where it is -EV to do so.
    I completely apologise - I have just realised I was getting confused with B936 - Betting and Gaming Duties Bill. Ray, please can you change my vote from a nay to an aye? Apologies for being an absolute pain in the _____.
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    (Original post by Quamquam123)
    I completely apologise - I have just realised I was getting confused with B936 - Betting and Gaming Duties Bill. Ray, please can you change my vote from a nay to an aye? Apologies for being an absolute pain in the _____.
    No problem.

    I have removed 1 No voted and added 1 Aye.
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    (Original post by RayApparently)
    No problem.

    I have removed 1 No voted and added 1 Aye.
    Thank You Ray.
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    I abstained in the end albeit i still intend to bring another bill forward myself (and ergo repeal this one).
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    Blergh..
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    Aye

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    Ayes to the right: 25
    Noes to the left: 15
    Abstain: 6

    The Ayes have it! The Ayes have it. Unlock.
    Turnout: 92%
 
 
 
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