URGENT UPDATE: Major UK bookmaker Betfred has issued a dire warning that nearly 1,300 betting shops could face closure if a proposed gambling tax increase is enacted. This potential move threatens the jobs of over 7,000 employees, marking a significant blow to the industry.
Betfred’s chairman and co-founder, Fred Done, described the looming tax hike as the “biggest threat” ever faced by the gambling sector. Competitors, including William Hill and Paddy Power, have echoed his concerns, underscoring the widespread impact across the market.
The proposed tax increase, initially suggested by former Prime Minister Gordon Brown to current Chancellor Rachel Reeves, aims to combat child poverty but has drawn sharp criticism. The Betting and Gaming Council labeled the plan “economically reckless,” warning it could drive gambling underground and exacerbate black market activities.
Done highlighted that many of his shops are already operating at a loss, stating, “An increase in tax would just make that amount increase.” Betfred’s latest annual report revealed a profit of £1 billion, yet half of that was consumed by operating costs, raising serious concerns about the sustainability of physical betting locations.
The impact extends beyond Betfred. The Institute for Public Policy Research (IPPR) estimates that a 50% increase in gambling tax could yield nearly £3.2 billion for public finances. However, this potential revenue comes at a steep cost to the industry. Evoke, owner of William Hill, warned of possible closures of 200 shops, while Paddy Power has already announced plans to shut down over 50 locations in the UK and Ireland, affecting around 250 workers.
Rival betting company Entain has also flagged potential shop closures if the tax is implemented, further illustrating the widespread repercussions of this legislative move.
Looking ahead, the demand for an additional £50 billion in public finances is putting immense pressure on Chancellor Reeves. As speculation mounts about the upcoming Autumn Budget, many are questioning how these changes will impact the gambling landscape.
Professor Ashwin Kumar, director of Research and Policy at the IPPR, emphasized the need for higher gambling taxes, stating, “We know that most of the profits made by gambling companies come from a very small number of gamblers, many of whom are at risk of serious harm.” He advocates for tax duties similar to those on alcohol and tobacco.
Meanwhile, charity GambleAware is calling for “further regulation” to protect children from the harms of gambling, highlighting the urgent need for action in light of the proposed tax changes.
As this situation develops, the future of the betting industry hangs in the balance. Stakeholders and employees are left to navigate an uncertain path, with the potential for widespread job losses and business closures looming large. Stay tuned for more updates as this critical story unfolds.
