MPs Urge Major Tax Hike on UK Gambling Industry

The All-Party Parliamentary Group for Gambling Reform was created to investigate the economic and social impact of gambling, providing guidelines on how this sector can improve. The tax increase proposal was an outcome of one of their investigations and seeks to improve public health, social welfare, and economic stability.

The cross-party group is calling for a rise in remote betting tax from 21% of gross profits to 50%. It is also calling for the general betting tax to rise from 15% to 25%. Tax on profits in Horse racing will also see an increase from 15% to 21%, bringing them in line with online casino rates.

The UK gambling industry is one of the fastest-growing industries, something which has undoubtedly been driven by digitalisation. The last decade has seen players swap their poker chips for their mobile phones, opting for the convenience of online casino sites rather than heading to the physical casinos. Recent statistics highlight that the sector is valued at around £15 billion a year. Individuals can use online sites for sports betting, casino games and lotteries.

As one of the largest sectors, it is estimated that around £3.4 billion is taxed from the gambling industry to the UK Treasury each year. The industry also provides plenty of employment opportunities, furthering its help to the UK economy.

However, this industry comes with criticism due to its negative social impact. With the rise of gambling, there has been a significant increase in gambling problems, addiction, and mental health issues that require an increase in government attention. This potential £3 billion tax increase would focus on funding support services for those impacted by gambling-related harm.

The gambling industry has voiced strong disagreement with the proposed tax increase, arguing that it could hinder further growth and innovation. As a key area for employment and technological advancements in the UK, it is argued that this could lead to job losses and a lack of investment in new technologies. Rather than opting for a tax hike, they propose effectively addressing social concerns head-on. The Treasury has reassured that this tax seeks to “cut down on bureaucracy — it is not about increasing or decreasing rates”.