Flutter’s British cash cow just pulled the ultimate regulatory arbitrage move – and it’s as predictable as it is ruthless
Leeds-based Sky Bet, the self-proclaimed “UK’s No. 1 betting app”, has quietly shifted its entire sports-betting operation to Malta under a new shell company, SBG Sports Limited. The result? An estimated £55 million annual tax saving, according to tax expert Dan Neidle. That’s £55 million that will no longer reach the UK Treasury at the exact moment the government is desperately scraping for every penny to plug its black hole.
From 1 November 2025, all “day-to-day commercial and marketing decision-making” is now handled from Valletta, not Yorkshire. The Leeds office remains open – for now – but 250 British staff were told in June they were surplus to requirements. Flutter’s official line? “Operating more efficiently and reducing costs.” Translation: we can make the same obscene profits while paying 5% effective corporation tax instead of 25%, plus dodge a chunk of VAT.
The Maths Are Brutal – and Entirely Legal but could be unefficient
Neidle’s calculation is based on Sky Bet’s 2024 profits. Malta’s infamous “tax refund” system means foreign-owned companies pay 35% on paper, then claim 30% back, leaving an effective rate of 5%. Add VAT advantages on remotely supplied services and you hit that magical £55 million saving.
As Neidle drily told ITV News:
“I know lots of people who’ve gone to Malta. They’ve all either gone there for sunbathing or to avoid tax. I don’t know anyone who’s gone there for any other reason.”
He also warned that Flutter is playing an extremely high-stakes game.
“If I had been advising them, I’d say it was reckless. The risk is that there’s a lot of expense in moving people to Malta, and then they’re stuck. If the law changes or HMRC successfully challenges their position, they could end up saving nothing – but permanently based in Malta.”
On top of that, UK budget is planning on remote gambling taxes; probably aiming at offshore (but licensed) operators.
This Isn’t New – It’s the Entire Flutter Playbook
Let that sink in: Paddy Power and Betfair have been registered in Malta (and Ireland) for years. Sky Bet applied for its Maltese licence back in 2017 when then-Prime Minister Joseph Muscat was openly courting “household names” in gaming.
Flutter itself just completed the ultimate flex – delisting primarily to New York while keeping a secondary London listing – because the US market is now worth far more than the UK ever will be. The UK is no longer the golden goose; it’s the goose has been cooked by successive tax rises, affordability checks, and statutory levy threats.
The UK gambling sector is now in the same position as the online poker industry in 2006–2011: anyone who can leave, does. Anyone who can’t is slowly strangled
The Real Story No One Wants to Say Out Loud
This isn’t about « efficiency ».
This is about a £30 billion company deciding that the UK is now a high-cost, high-regulation, low-growth market not worth paying full tax in.The root cause isn’t Sky Bet being greedy (though they are).
This is about a £30 billion company deciding that the UK is now a high-cost, high-regulation, low-growth market not worth paying full tax in.The root cause isn’t Sky Bet being greedy (though they are).
The root cause is a UK regulatory and fiscal regime that has made it mathematically irrational to keep profitable remote gambling operations domiciled here.When your effective tax rate is five times higher than your direct competitor jurisdictions, and your regulator is simultaneously trying to destroy your product with affordability checks while demanding you pay a statutory levy, the C-suite has a fiduciary duty to shareholders to leave.Flutter just executed that duty with surgical precision.
This is about Laffer’s curve; taxing too much results in no taxes collected.
What Happens Next?
HMRC could challenge the structure (they’ve become increasingly aggressive on these Malta shifts).
Labour could close the loopholes (they won’t – they need the remaining tax revenue too badly).
Labour could close the loopholes (they won’t – they need the remaining tax revenue too badly).
Or the Gambling Act white paper reforms will simply accelerate the exodus until only retail-heavy dinosaurs like Entain remain paying full whack.Either way, the British public gets the worst of all worlds: fewer jobs, less tax revenue, and the same problem gambling rates because the customers will simply keep betting with the same brands – just taxed elsewhere.Welcome to British gambling policy in 2025: world-leading virtue signalling, third-world tax take.Sky Bet didn’t break any rules.
They just proved, once again, that in iGaming, capital goes where it’s treated best.And right now, that’s anywhere but here.
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