MPs aren’t buying what the gambling industry is selling – as betting firms warn of apocalyptic job losses and shop closures, the Treasury Committee basically told them to stop crying wolf about potential tax increases.
Gordon Brown told UK media that he believes UK online bookmakers could well afford to pay for a heavier tax burden. The former PM knows the industry well – he helped modernize UK gambling laws back in 2005, and now he thinks it’s payback time.
The numbers tell the real story here – remote gambling accounted for £6.9bn in gross gambling yields for the year to March 2024, compared to £4.6bn in offline betting, according to the Gambling Commission. Online betting has taken over, and that’s where the money is.
Dame Meg Hillier, who chairs the Treasury Committee, didn’t hold back. She said online betting games extract huge amounts of money from people who get funnelled into the most addictive corners of the industry. The committee flatly rejects the industry’s claim that gambling causes no social harm.
‘We’re going to lose the whole retail business,’ Betfred’s chief executive Joanne Whittaker told the Times over the weekend, adding that it was neither ‘scaremongering’ nor ‘alarmist’ to claim that 1,300 shops and 7,000 jobs were on the line. Fred Done from Betfred claimed 300 of his shops already lose money, and even a 5% tax increase would sink 130 more.
But what they don’t mention is that shops are closing anyway. Paddy Power, owned by Flutter Entertainment, follows a full review of its high street operations, led by increasing cost pressures and challenging market conditions. So, they’re shutting 57 shops, affecting 250 jobs, while William Hill plans to close 200 stores.
The proposed tax hikes are substantial, though. The current 15% general betting duty on land-based bookmaker profits could be doubled. Remote gaming duty could also jump to 50%, which would bring in some serious money for the Treasury.
Yet, here’s something interesting – players are already voting with their feet. Many have found out that online casinos usually have way better odds than regular bookies. Smart punters now research payout rates carefully. For those seeking to maximize their returns, the best payout casinos explained by gambling expert Matt Bastock show exactly which operators give players the best mathematical edge with higher RTP rates and fairer games.
The industry keeps throwing around big numbers – and Grainne Hurst from the Betting and Gaming Council says members contribute £6.8bn to the economy and support 109,000 jobs. She claims they already face tax rates up to 80%.
International comparisons hurt their case, though. Some US states, including new market operators that are scrambling to enter, have tax rates above 50%, as does Austria. The Netherlands is set to raise its rate to 40% – so, the UK suddenly doesn’t look so harsh.
Then came the plot twist. The Autumn Statement has revealed that no tax increases will be applied to UK Gambling in the 2024 Budget. The industry dodged the bullet – for now. But the government will consult next year on restructuring the whole tax system.
The reality is that high street betting shops were dying before any tax debate started – and online gambling has won. The question isn’t whether the industry will pay more, but when and how much.
