URGENT UPDATE: Betfred, one of the UK’s largest bookmakers, has issued a dire warning that nearly 1,300 betting shops may be forced to close due to a proposed increase in gambling taxes. This move could threaten the jobs of more than 7,000 employees across the country.
Chairman and co-founder Fred Done described this potential tax hike as the “biggest threat” the gambling industry has ever faced. Competitors within the sector echo his concerns, highlighting the immediate and severe implications for the entire industry.
The proposed tax increase, originally suggested to Chancellor Rachel Reeves by former Prime Minister Gordon Brown, aims to combat child poverty. However, this plan has drawn sharp criticism from the Betting and Gaming Council, which represents gambling companies and labels the proposal as “economically reckless.” Officials warn this could lead to a surge in underground gambling operations.
“A large number of my shops are constantly in the red,” said Done. “An increase in tax would just make that amount increase.”
Despite reporting a profit of £1 billion in its latest annual report, Betfred revealed that half of this amount went toward covering operating costs, underscoring the financial strain faced by many betting shops. The impact of the proposed tax is already rippling through the industry, with estimates from the Institute for Public Policy Research (IPPR) suggesting the tax hike could generate close to £3.2 billion.
Other major players in the gambling market have begun to react. Evoke, the owner of William Hill, warned that the new tax could result in the closure of 200 shops. Similarly, Paddy Power announced it would shutter over 50 locations across the UK and Ireland, affecting around 250 jobs. The situation is so critical that Entain, another significant betting company, is also considering closures if the tax is enforced.
Done expressed concerns about the long-term future of high street gambling, stating, “Slowly it will go online, but we’re talking, without tax increases, we’ve still got probably 20 years of life on the High Street.”
The potential tax hike comes at a time when the UK government is facing pressure to raise £50 billion for public finances, further complicating the landscape for the gambling sector. The upcoming Autumn Budget is expected to address these pressing financial needs, but many are questioning what changes will be made.
Professor Ashwin Kumar, director of Research and Policy at the IPPR, has weighed in on the debate, advocating for higher gambling taxes. He stated, “We know that most of the profits made by gambling companies come from a very small number of gamblers, many of whom are at risk of serious harm. And so we think that the duties should be higher, just like tobacco and alcohol.”
Charity GambleAware is also calling for “further regulation” to protect vulnerable individuals, particularly children, from the dangers of gambling.
This situation is developing rapidly, and the stakes are high for both Betfred and the broader gambling industry. As the Chancellor reviews the proposed tax changes, all eyes will be on the forthcoming budget, which could have lasting impacts on gambling operations across the UK.
Stay tuned for live updates on this critical issue as it unfolds. The future of thousands of jobs and the structure of the UK gambling industry hangs in the balance.