Betfair has announced that its betting exchange is to operate under a Gibraltar licence from today (9 March) in a bid to reduce its tax obligations.

The company said it would maintain its contribution towards the Horserace Levy despite its move offshore, which also aims to ensure the group remains competitive in the UK market. It comes as Betfair reported a 6.2 per cent growth in core revenue for the third quarter of the 2010 financial year, although poker revenue declined by 5.2 per cent.

Warwick Bartlett, chief executive officer of gambling consultants GBGC, said: "Betfair is now a publicly listed company whose shareholders will have been asking the question whether paying a 15 per cent tax in the UK is worth it. "The tax rate in the UK market is too high. These are companies that would much prefer to be in the UK, where they would be providing thousands of jobs, and would come back if the rate was lowered."

Meanwhile, Paddy Power has reported a 56 per cent growth in operating profit for the year to 31 December 2010, with a six-fold increase in UK retail operating profits. Patrick Kennedy, the company's chief executive, said: "[These results] demonstrate the benefit of our ongoing business development initiatives and investment, which position the group well for further growth in 2011 and beyond."