BGC: mandatory levy must be tiered to protect land-based operators

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A mandatory levy to fund research, education and treatment would be welcomed by members of the Betting and Gaming Council, however, a warning has been issued regarding the implementation of a blanket fee.

The industry standards body has suggested that any such potential introduction, which is expected to be included in upcoming government reforms to betting and gaming in the UK, should be independent and tiered to protect land-based establishments.

Michael Dugher, BGC CEO, said: “I have said for some time that I am relaxed about a so-called statutory levy given that the money is already on the table from BGC members, it is already allocated independently of the industry and given that it was the BGC who proposed to government last year that contributions should be mandatory. 

“But we want to see continued sustainable funding for RET provided it recognises the fact land based operators are under greater cost pressures, so there has to be appropriate mitigation, and that funds continue to be distributed effectively and genuinely independently.”

The BGC has noted that a mandatory levy should comprise a sliding scale and smaller percentage contributions from land-based gambling businesses that it says “have disproportionately higher fixed costs like more premises and staff”.

The BGC noted additional pressures already being felt by businesses such as casinos, bingo halls and betting shops in cautioning against a statutory one per cent levy.

This includes severe economic headwinds, including a slower than expected post-covid recovery, rising fixed operating costs, high inflation and pressures on customers caused by the cost-of-living crisis.

Furthermore, the BGC estimated that a one per cent levy to land-based operators would be the equivalent of between 10 per cent and 15 per cent hit on post-tax profits, because of the fixed costs which do not equally apply to online operators. 

“What’s important is that the money goes to helping the tiny minority of people who need it, not wasted on the cottage industry of anti-gambling prohibitionists, masquerading their biased work as ‘research’,”  Dugher commented. 

“But most importantly, any new system must be tiered to protect land-based operators like bingo, casinos and betting shops, who have disproportionately higher fixed costs because of buildings and tens of thousands of staff. 

“They are still struggling post-covid, like every other retail, hospitality and entertainment business, with all the difficult economic headwinds.

“The government claim they believe in low regulation and low taxes for businesses, so they need to avoid this new tax leading to job losses or more businesses going bust.” 

BGC members contribute £7.1bn for the economy and generate £4.2bn in tax while supporting 110,000 jobs. Casinos support 15,000 jobs and contribute £300m in tax, while betting shops support 42,000 jobs and pay £800m to the exchequer.