The Betting and Gaming Council (BGC) is showing no signs of backing down following its repeated call urging UK ministers against implementing any new taxes or higher tax rates that could threaten growth, put jobs at risk or undermine the customer experience within the gambling industry.
Over the past forty years, governments and industries have justified the global liberalization of commercial gambling due to the undeniable amount of jobs and revenue it generates. However, it is becoming increasingly impossible to ignore the detrimental effects harmful gaming practices have on individuals, families and communities.
In fact, the NHS Has had to open two new gambling clinics to respond to the record demand, as an estimated 430,000 people in the UK are reportedly suffering from compulsive gambling. The UK is expected to be hit with a regulatory shift following the Conservative government’s review of the 2005 Gambling Act in which the policy remains dominated by the concept of ‘responsible gambling’, as in many other high-income countries.
No matter how strong the online gambling industry is, the reality is that the introduction of new or possibly higher tax rates can spell bad news. Online casinos with a high customer base made up of thousands of players benefitting from UK only no deposit bonuses will feel the pinch the most.
Financial Hits
According to Michael Dugher, the CEO of BGC, in addition to the constant regulatory changes affecting the industry, all businesses, including those within the BGC such as betting shops, bingo halls, and casinos, are attempting to recover from a series of financial hits. As such Dugher has stressed that the government should evaluate how an increase in taxes could affect not only the recovery of the industry but also its members and consumers.
For the former Labour MP, the path ahead is clear, in order for the gaming industry to continue to play a large part in the UK economy and grow, there needs to be a pro-business budget with no new tax rises. Additionally, the white paper must be well balanced in that it protects the vulnerable tainting the experience for the majority of those who exercise safe betting practices.
The gambling industry is not limited to online and brick-and-mortar casinos but it supports the hospitality, tourism and leisure sectors as well. As such, cracking down on the gambling industry could have a negative ripple effect and impact numerous jobs. Additionally, land-based casinos are still recovering from the impact of the Covid-19 pandemic as while the online gambling industry flourished, this took a major hit.
Dugher also took aim at the anti-gambling lobbyists pushing for the imposition of affordability checks on gaming businesses, which he called intrusive and stated that they will push customers to unregulated black market online casinos which will not employ any of the safer gambling protections that exist in the regulated industry and where no taxes are paid.
Jeremy Hunt’s Budget Breakdown
The UK’s discouraging tax rate has not only threatened the growth of the gambling industry, but it has also pushed Britain’s biggest drugmaker AstraZeneca to build a £320m factory in Dublin, rather than north-west England where it has other sites, causing the area to lose out on jobs and a financial boost.
The business sector received another blow with the Cambridge-based Arm Holdings which is owned by Japan’s SoftBank, opting for a New York stock market listing rather than pursuing a London stock market listing, as it could value it at more than $50bn.
Despite these recent setbacks, while delivering his first budget as chancellor, Jeremy Hunt insisted that he had restored economic stability claiming that inflation was under control following the chaos of the Liz Truss premiership last year. The fiscal watchdog offered a £9bn tax break for business, an extension of free childcare and a surprise pension boost for the well-off.
In April, corporation tax on profits over £250,000 is due to rise from 19% to 25%, businesses will then be able to offset 100% of UK investments against their profits to bring down tax bills. Mr Hunt stated that these measures will be in place for the next three years however he intends to make them permanent. Additionally, the OBR stated that it will increase business investment by 3% for every year.
For small and medium-sized businesses an “enhanced credit” is being introduced if they spend 40% or more of their total expenditure on research and development. They will be able to claim credit worth £27 for every £100 spent.
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