Reading Time: 3 minutes
The Betting and Gaming Council, a standards body, has warned that further tax increases could bolster the black market for illegal gambling while undermining significant economic contributions from the regulated industry.
New figures from leading consultants EY, released ahead of the Budget, confirm that BGC members contribute PS6.8bn to the economy as Gross Value Added. They also raise PS4bn more in taxes for the Treasury while supporting 109,000 job opportunities.
The UK’s regulated gaming and betting sector provides jobs and income to those in the UK who are struggling.
The government also invests millions in sports such as horseracing and rugby league. They also support football, snooker darts, boxing, snooker and darts.
Tax increases combined with the White Paper of last year on gambling reform and the growing unregulated, unsafe gambling black market could threaten to undermine this continued investment, threatening both growth and jobs.
According to figures from the previous government, White Paper measures that the BGC requested to improve standards will cost the industry around PS1bn.
Black market gambling has risen in Europe’s comparable markets, where taxes have been increased on operators regulated by the government. This gambling pays no tax, doesn’t contribute to sports and does not protect players.
Recent research commissioned by BGC revealed that 1.5 million Brits spend up to PS4.3bn annually on the black market of illegal and unregulated gambling.
The current economic downturn, which is expected to continue, has also taken a toll on the pockets of customers, including their ability to invest in hobbies such as betting.
BGC CEO Grainne Hurst stated: “Our industry is at a crossroads, as we strive to implement the White Paper measures and bring a new era to stability and growth. This will allow us to continue to make significant contributions to the economy of the country.
After so many years, the sector requires stability in order to attract sustainable investment. Further change could undo this contribution.
“Any new tax now, at any level, at this crucial juncture, risks undermining the good work and giving a boost to the lurking threat of the blackmarket, which is prepared to snare dissatisfied customers sensitive to any degradation of the offer that they receive in the regulated industry.
“The customers have been under extreme pressure for years. They have had to pay their bills and taxes, then enjoy their hobbies, including having a little fun. We do not want to see pressure put on workers.
“Regulated gambling and betting remains a popular pastime for the vast majority of people in the UK. Our members are an export from Great Britain and global leaders who deliver enormous economic benefits in city centres, high streets, and the growing online sector. BGC members invest millions in Britain’s leading sports, which has a positive impact on other sectors.
“We are looking to work with the Government to ensure that the right regulations and tax regimes are in place, so as to not harm customers, attract illegal operators or put jobs at risk, but to instead deliver on the Government’s growth agenda.”
The White Paper, hailed as a “once-in-a-generation” opportunity for reform, announced measures such as an Ombudsman who would improve consumer redress. It also included new online stake limits and modest plans to modernise casinos, and a new tax to fund Research Prevention and Treatment services (RPT).
BGC members have donated more than PS170m in the last four-years to support a mature charity network, including PS50m just last year.
When introduced, the new RPT Levy will raise PS100m per year.
BGC members contribute an additional PS100m per year to the Horserace Betting Levy, which is used to advance veterinary sciences in the sport as well as to contribute to the improvement of horseracing.
EY’s new research also tracked trends within the sector. It confirmed that Gross Gambling Yield (GGR) from online gaming and betting has remained stable, but it also highlighted the pressures faced by land-based casinos and bookmakers.
Casinos have declined in the last few years. From 156 in 2019, to 117 today, with five of them being high-end casinos.
The UK has 5870 bookmakers, and 2485 have closed since 2019. This is a 28% decrease, due to regulatory changes, as well as the effects of the Covid epidemic.
The BGC had previously called on the Government to introduce modest but critical modernisation plans for the land-based industry to compete and provide the experience that their customers expect.
