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Read Full BioUK Chancellor Rachel Reeves has indicated that she will include a tax hike on gambling in her November budget.
Speaking at the Labour Party conference, Reeves told ITV, “I’m the chancellor who set up the review of gambling taxes. No other chancellor has done that, because I do think there’s a case for gambling firms paying more.
“I talk to a number of businesses from all sectors of the economy, including the gaming sector. On a personal level, I have never bet in my life on anything, but they make an important contribution to the economy.
“But they should pay their fair share of taxes, and we will make sure that happens.”
She did not add further details, but the topic of raising taxes on the gambling industry has been discussed at length recently. This is the first clear comment from Reeves that she plans to include an increase in the next budget.
Increased Taxes Divides Opinion
The prospect of increasing taxes has divided opinion. Critics warn it will stifle the economy and increase unregulated gambling, while supporters say the additional revenue can solve a range of problems.
Reeves did not specify the amount of the new tax. The Treasury has proposed increasing taxes on horseracing from the current 15% to 21%. In response, the British Horseracing Authority (BHA) made the unprecedented decision to go on strike in protest.
The strike may have had some impact, as Labour MPs sent a letter to Reeves last week urging an increase in gambling taxes, but not on horseracing.
The letter was co-written by Dr. Beccy Cooper MP and Alex Ballinger MP on behalf of the Gambling Reform All-Party Parliamentary Group (APPG).
The MPs noted, “Increasing taxes on horseracing risks driving consumers toward more harmful gambling products.”
MPs Call for Increased Taxes on Online Gambling
Instead of raising taxes on horseracing, more than 100 Labour MPs signed the letter calling for an increase in taxes on online gambling. They also refuted arguments that the gambling industry stimulates the economy.
The letter added, “The online gambling sector contributes relatively little to UK employment and research suggests that consumer spend on gambling brings little value to the UK economy as a whole.”
It went on to highlight recommendations from the Institute for Public Policy Research (IPPR), which has advocated raising taxes on slots and online casinos to 50%. Former UK Prime Minister Gordon Brown has supported the recommendations, believing the revenue generated can be used to combat child poverty.
BGC Speaks Out Against Tax Hike
The Betting and Gaming Council (BGC) has been vocal in its opposition to any tax increase on the gambling industry. The BGC represents over 90% of UK-licensed operators and states that a tax increase will cause untold damage.
As the prospect of a tax increase in November draws nearer, the group released another statement in opposition. A spokesperson said, “Such a move would be short-sighted, harming jobs, investment, and sports funding, while failing to deliver more revenue.”
The statement added that increasing taxes will lead to growth in the unregulated gambling industry, claiming, “Every time the Treasury squeezes the regulated sector, it strengthens the unsafe black market, which pays no tax, offers no consumer protection, and puts UK jobs and growth at risk.”
