Social Market Foundation claims half of Britons support tax hike on online gambling

A rumored double-digit tax hike on remote gaming duty and general gambling tax in the United Kingdom has caused quite a stir. Originally reported by The Guardian and still unconfirmed – which should happen at the Autumn Budget reading – there are indications that the general public could be favoring the move.

Double digits increase in tax has strong public support

According to the Social Market Foundation, which published a new report tracking public attitudes towards the gambling tax increase, more than 50% of all Britons are in fact in favor of raising taxes on the gambling industry, and online gambling in particular.

The idea is to change the tax value from 21% presently to 50% moving forward, which could result in £900m (per Social Market Foundation data) going directly into the Treasury and helping tackle a sprawling deficit. 52% of all Britons said they support the measure, and two-thirds of all respondents said that they prefer the gambling tax to be the first to be raised by the government, compared to tax on income, VAT, inheritance, or duties on fuel, alcohol, or tobacco.

In other words, the online gambling industry is in the crosshairs of not just the Labor Party’s government, but also in the crosshairs of public opinion. The government is eager to address the £22bn deficit it has to foot, and a tax raid on the gambling industry could raise as much as £3bn, as reported by The Guardian sources.

Naturally, the industry has already protested vehemently, describing the new proposal as a fantasy not grounded in reality that would have damning consequences for the regulated market, the jobs it creates, and inadvertently but inevitably empower black market operations that continue to encroach and threaten consumer safety.

Tackling harm and aligning the UK’s gambling tax with other jurisdictions

Commenting on these findings, Social Market Foundation Research Director Dr Aveek Bhattacharya has welcomed the measure and said that it would be logical for the tax to go up, as UK betting and gaming companies have long been benefiting from lower overall duties.

"For too long, online gambling operators have profited from lower tax rates in the UK than many of our peer countries. Doubling remote gaming duty to 42% would better reflect the social and economic harm they cause, and raise to £900 million for the public purse."

The survey by the Social Market Foundation said that some jurisdictions, including the United States, charge remote forms of gambling with more than 50% tax, although this only applies to Pennsylvania where the tax on remote slots is 54%, and in New York, the blanket state tax on sports betting is 51%.

Online gambling, according to the Social Market Foundation, has a higher incidence of harm compared to other forms of gambling. The research outfit also said that gambling is also not subject to VAT taxation.

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