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Vice Media has just got through visiting the British overseas territory of Gibraltar, surprisingly now the fastest growing economy in all of Europe with an unemployment rate around 6 percent. Much of this can be attributed to the online gambling sector.
Peter Howitt of the Gibraltar Betting and Gambling Association tells Vice that gambling "is estimated to constitute as much as 25 percent of the GDP of Gibraltar, and it contributes millions in corporation tax, gambling duty [and] PAYE from the thousands of people employed in the industry."
But all of this could soon change.
From Vice:
The upcoming reform to the UK Gambling and Gaming Act could spell the end of Gibraltar's economic honeymoon. As of December, 2014, gaming companies will have to pay tax based on where their money is made, rather than where the company is registered. It's a situation that even the chair of the Gambling Association admits could lead to companies leaving for fairer climes and better tax laws.
The article focuses heavily on tensions between “The Rock” and Spain, noting that, along with a proliferation of nice cars and shiny things, the windfall has brought tensions along the border with Spain to a 20-year high.
The staggering economic disparity in the area—wealthy Gibraltar sits directly below Andalucia, a historically poor part of Spain—can't be ruled out as a contributing factor to the recent hostilities, Vice suggests.
If Gibraltar's economy contracts, the most vulnerable—Spanish workers in the service sector—will be the hardest hit, bringing even more economic devastation to an area already whipped raw by the financial crisis.
What this will mean for the ethnic and political tensions in the area is still up in the air. Despite the posturing and their baffling (but, I guess, understandable) love of the Queen, the pro-UK activists I meet in Gibraltar are polite, middle class IT geeks, upset and outspoken but hardly about to wage a race war.
- Aaron Goldstein, Gambling911.com
