- Betfred threatens closures amid proposed UK gambling tax hike.
- Reeves considers raising betting levies to balance public finances.
- Industry warns of job losses and retail betting decline.
UK betting operator Betfred claims it will close all 1,287 of its retail betting outlets if the British government hikes the taxes on sports wagering and slots.
Chancellor Rachel Reeves could be planning a £3.2 billion tax hike to help close a £30 billion gap in public finances in next week’s budget. That’s if she heeds the advice of the Institute for Public Policy Research (IPPR), a thinktank that has close links to the ruling Labour Party.
Former Labour prime minister Gordon Brown is backing the changes recommended by IPPR, arguing they could reduce child poverty in the UK.
Reeves has said she believes there is “a case” for gambling companies to pay more taxes and “we will make sure that happens.”
Media Offensive
The threat has ramped up lobbying by the gambling industry, as well as efforts to court the media.
Speaking to the BBC, Fred Done, 82, founder and chairman of Betfred, warned that the think tank’s recommended increase – raising the sports betting levy from 15% to 30% and the slots tax from 20% to 50% – would spell curtains for his network of brick-and-mortar betting shops.
If [the overall tax rate] went up to anywhere like 40%, or even 35%, there is no profit in the business. We would have to close it down. I’m talking job losses. We’re talking probably 7,500,” he told the BBC on Sunday.
The billionaire businessman said such an increase would be the “biggest threat” to the industry since he launched Betfred with his brother, Peter Done, as a single betting shop in Manchester, England, in 1967.
Betfred CEO, Joanne Whittaker, told The Times of London that the company’s position was not “scaremongering” or “alarmist.”
“The most frightening element is we’re going to lose the whole retail business,” she said.
William Hill has also warned that it may have to shutter 200 betting shops, impacting 1,500 jobs, and Entain’s Ladbroke’s Coral has also warned of closures.
Deja Vu?
The last big threat to the UK’s retail betting industry was the government’s decision to cut the maximum stakes on fixed-odds betting terminals (FOBTs) from £100 to £2. Again, the industry warned of mass closures and thousands of job losses.
This wasn’t just scaremongering – their fears were based on the real threat of losing a major revenue engine – but hindsight shows the bookies were leaning toward a worst-case scenario.
Prior to those reforms, William Hill predicted up to 900 closures, or around 40% of its retail outlets. In reality, the number of shops across the sector fell by roughly a quarter over the following years – still significant, but this was partly driven by other forces the industry couldn’t foresee, notably the pandemic.
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