100% Tax Hike For Online Gambling in the UK?
The United Kingdom’s Secretary of State for the Department for Culture, Media and Sport (DCMS), Lisa Nandy, has downplayed a major story in The Guardian newspaper that suggested the British government is about to launch a £3 billion tax raid on the British gambling industry. But this wasn’t an outright denial, and the industry is bracing for a storm.
Government Targeting Online Gambling
Online casinos, in particular, could take a heavy hit when the next budget is announced on October 30th. Two separate think tanks have identified gaming as a “higher harm product” and have recommended raising taxes on the sector by 21-100%
The newspaper recently published a story that suggested the British government was ready to sink its teeth into the industry. The government claims to have found a £22 billion black hole in the country’s finances, and the Institute for Public Policy Research (IPPR) believes the government could raise £2.9-£3.4 billion by 2030 by doubling taxes on the industry.
The Social Market Foundation has proposed raising the taxes by 21-42%, which would bring an extra £900 million to the public purse.
It’s clear that the UK gambling industry is facing a tax hike, and stock prices fell across the board as a result of the news. Industry figureheads, including Betting and Gaming Council CEO Grainne Hurst and Flutter Entertainment CEO Peter Jackson, have spoken out against additional levies, and it’s all adding fuel to the fire.
Not So Soothing Words
Now, Nandy has tackled the issue in the House of Commons, but she chose her words very carefully. “You can’t believe everything that you read in the papers,” she said. “I think he will have heard from my previous answer that we are determined to strike the right balance.
“We’re aware of the value of this industry and the importance of it not just to the UK economy, but the joy that it brings to many, many people, and the employment prospects that it offers to people in every region of the United Kingdom.
“We are also very aware of the problems that can be caused by problem gambling, and as the previous Government did, we are determined to talk to the widest range of partners to ensure that we strike the right balance to protect people from the problems that can ensue, but also to support the growing industry.”
Online Gambling a Harmful Product?
As the two think tanks have already identified online gambling as a “higher harm product”, it seems likely that there will be a tax raid on the industry in the next budget. Now, the gaming sector can only watch and wait to hear the news when the UK Chancellor Rachel Reeves takes to the Despatch Box on October 30th.
France recently went through a similar round of rumours and denials about a major tax hike for its gaming operators. In the end, the French government decided not to attack its own industry and did not impose any further tax hikes. So, it’s possible that the UK government will take the same approach, but the industry is still braced for some bad news at the end of the month.
