Betfair has announced that it has decided to withdraw its sports betting exchange product from the German market.
This is as a result of the 5% tax introduced in July on sports betting that Betfair felt it was exempt from. The Hammersmith-based company had been in conversations with German tax authorities over whether the tax applied to them but have been unable to reach a resolution.
Despite withdrawing their betting exchange the company will continue to offer other products in the country including the Betfair Casino, poker and fixed-odds betting products.
However, in a statement released to shareholders, the company admitted that this may change in the future.
The statement read: “On-going contribution from Germany is expected to be de minimis and Betfair is reviewing its operations in this market”.
The company also revealed that just 4% of the company’s revenue came from the market which amounts to £6 million. In light of this, the company’s shares shouldn’t take much of a hit.
Betfair’s main issue with being forced to pay tax on the sports betting exchange was that they were being taxed on all money wagered, rather than just the profit kept by the company.
The clarity of German gambling law has been sketchy at best in the recent past and while regulation now seems stable on sports betting, casino and poker regulation is still yet to materialise.