GIBRALTAR may have a higher number employed in its egaming industry – but our egaming sector contributes £74 million more to our economy.
In Tynwald, Onchan MHK Zac Hall asked what key differences there are in government support to the gambling sector that have enabled the Isle of Man to employ about 750 in the industry but allowed Gibraltar to employ some 4,000.
In his written reply, Economic Development Minister John Shimmin insisted that government support was by no means the critical factor in encouraging the relocation and growth of gaming industry operators.
He explained that other factors including gaming duty, labour availability costs and VAT.
Mr Shimmin MHK said: ‘It is clear that the decision by some of the large companies to locate their gaming operations in Gibraltar as opposed to the Isle of Man is based on many factors only one of which is taxation.
‘The nature of the Gibraltar operators’ business model, the lower salaries required for employees and lower overall overheads, the lower demand for government provided infrastructure eg housing, health, education, roads etc are, perhaps, more significant factors.’
He pointed out that many of Gibraltar’s employees are not resident in that jurisdiction, whereas in the island all employees are resident.
The Minister said the Isle of Man can do little to compete with the lower costs available in Gibraltar, but the island’s operators are less reliant on a single gaming market which should mean the impact of the UK’s 2014 licensing legislation will also be less dramatic than anticipated in the Mediterranean protectorate.
Gilbert Licudi, Gibraltar’s Minister for Gaming, has warned this could have very serious consequences for the economy of the British Overseas Territory.
He said this is an important factor as the gaming sector represents 20 per cent of Gibraltar’s Gross Domestic Product whereas in the island’s more diversified economy, it contributes 8 per cent.
Mr Shimmin said 20 per cent of Gibraltar’s £1 billion GDP represents about £200 million, but the 8 per cent GDP contribution in the Isle of Man equates to about £274 million.
‘Therefore the island’s gaming sector contributes £74 million per year in real terms more to our economy than in Gibraltar despite their higher number of employees,’ he said.
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