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A further tax raid on Britain’s betting and gaming industry would devastate jobs, undermine the economy and drive billions into the hands of the gambling black market, according to independent analysis by EY.

New research, commissioned by the Betting and Gaming Council, reveals plans being championed by the SMF and IPPR think tanks would risk over 40,000 jobs, channel £8.4bn in stakes to the black market, and wipe £3.1bn off the sector’s UK economic contribution, while raising a fraction of the amount claimed by the think tanks.

BGC members currently contribute £6.8 billion to the UK economy, pay £4 billion in tax and support over 109,000 jobs across the country – including thousands of high-skilled tech roles in areas like Stoke-on-Trent, Manchester, Leeds, Nottingham, Sunderland and Warrington.

But new tax hikes threaten to dismantle that success, with serious consequences for workers, the Treasury and Britain’s high streets.

Grainne Hurst, Chief Executive of the BGC, said: “It is now clear these further tax rises are a direct threat to British jobs and economic growth.

“The figures speak for themselves – tens of thousands of jobs lost, billions diverted to the black market, and a possible £3 billion hit to the economy.

“Tax raids like those proposed would mean fewer betting shops, casinos and bingo halls, fewer jobs, and a huge boost to the growing, unsafe gambling black market, while not raising anywhere near the tax claimed.”

Both the SMF and IPPR recommended increasing – and in some cases doubling – taxes on betting and gaming.

Currently, bookmakers pay tax on Gross Gambling Yield – takings minus customer winnings – at 21% for online games like bingo, 15% for sports betting and 20% for machine gaming.

Both the SMF and IPPR recommended rates of 50% for online gaming, or Remote Betting Duty, and 25% for sports betting, termed General Betting Duty.

While the IPPR’s plans would cost 40,000 jobs, channel £8.4bn in stakes to the black market, and wipe £3.1bn off the sector’s economic GVA, an analysis of the SMF proposals showed it would cost 30,200 jobs, drive £8.1bn in stakes to the black market, and cost the sector £2.5bn in lost GVA to the economy.

The IPPR had claimed these tax increases would generate £3.2 billion in revenue. However, analysis by EY indicates the actual short-term gain would be closer to just over £1 billion.

But when additional factors such as lost employment, reduced corporation tax, lower National Insurance contributions and venue closures are taken into account, EY’s modelling suggests the Treasury’s net gain could fall to under £500 million.

Industry experts warned that the short-term gain would plummet as the hikes bed in and punters abandon the regulated sector amid worse odds, fewer promotions and a reduced offer for bookmakers.

Both think tanks have also ignored the 2023 Gambling Act Review White Paper – the most comprehensive reform of UK gambling laws in a generation –which is already projected to reduce sector revenues by around £1 billion.

Their projections also assume a 31% growth rate for the sector by 2025, whereas EY calculates that growth between 2023 and 2026 will sit at just 4%.

Hurst added: “Balanced regulations and a stable tax regime guarantee a growing regulated sector. But these proposals would achieve the absolute opposite of that and undermine the very consumer protections that keep people safe by pushing customers towards the unregulated black market, where there are no safeguards, no tax receipts, no jobs, and no support for the sports we all love.

“Britain’s betting and gaming sector is a world leader – employing thousands, paying billions in tax, and investing in British sport.

“The choice is clear: back a successful, sustainable, regulated British industry – or risk losing jobs, investment and growth.”

The post BGC: Further Tax Raid on Betting Threatens 40,000 Jobs and £3B Blow to UK Economy, Warns New Analysis appeared first on European Gaming Industry News.