UK mulling over double-digit gambling tax hike

The UK government could turn to the gambling industry in a bid to plug the budget deficit, as the public purse is under increased constraints that have already cost infrastructure, pensions, and other public spending.

The Treasury is grappling with a £22bn deficit which will remain increasingly difficult to tackle unless extra tax windfall is found, and "sin industries" might be on the receiving end of the fiscal rigmarole.

Plugging deficit holes at the expense of the gambling industry

The Labor government is hoping to raise around £3bn from the sector by levying it with a much higher tax, adding a double-digit increase to the final tally, a report by The Guardian suggested.

Essentially, the government is potentially looking to double the general betting duty to 30% from its current 15%, while hitting online gambling operators with a new remote gaming duty of 50%, up from the 21% they pay currently.

The media suggested that the Institute for Public Policy Research, which is a left-leaning research outfit, might have hand something to do with the potential tax increase, suggesting that products that have a high societal cost, such as gambling, should be levied more heavily.

Trade groups, such as the BGC, have not yet commented on the issue as of the time of writing this article. However, some of the biggest British gambling companies, have already taken a tumble to their share price today, with Entain losing 12.6% of its value and Rank Group suffering a 6.9% decline.

Evoke seems to have taken the biggest hit, with the company losing 15.4% of its momentum, not least because the company withdrew from the North American market to refocus efforts in more lucrative markets. Flutter slipped 8.8%

"On the map and no obvious pushback"

Not all activities will be targeted, however, according to the original report. In fact, bingo and the lottery should be left untouched so far as taxation goes.

According to The Guardian’s own sources, the proposal is "on the map" and there is no "obvious pushback" which could mean that while the gambling industry had worried about stricter advertising practices and more demanding customer onboarding processes, they should have really been thinking about what double-digit tax increase would mean for their businesses.

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