BGC Decries UK Government’s £5M Casino ‘Stealth Tax’ Amid Economic Struggles

UK Casinos Face £5M Annual ‘Stealth Tax’ from Government Duty Freeze

The Betting and Gaming Council (BGC) has raised a red flag against the UK government’s recent economic move, labeling it as a stealth tax raid on the casino industry. This action, which comes amidst various economic pressures, is anticipated to impose an additional £5 million burden on casinos annually.

The crux of the issue lies in Chancellor Jeremy Hunt’s Autumn statement, where he announced the freezing of gaming duty bands. Contrary to the land-based casino sector’s expectations of an adjustment in line with inflation, the bands have remained unchanged since March. According to the BGC, this decision effectively translates into a £25 million tax hike over the next five years, posing significant challenges for an industry already grappling with rising wages and high inflation rates.

Michael Dugher, CEO of the BGC, warns that this covert tax could stifle the sector’s recovery and future growth. He urges a policy revision, emphasizing the missed opportunity to bolster a sector poised to generate jobs and investment nationwide.

Casinos, pivotal in tourism and hospitality, contribute approximately £300 million in taxes annually, with a broader economic footprint of around £800 million per year. However, the industry has been reeling from the cost-of-living crisis and other economic hardships. The BGC points out the closure of four casinos in recent months and a 25% reduction in workforce compared to four years ago. Since 2005, one in four casinos have shuttered, leaving just 117 operating in the country.

While the BGC supports the government’s gambling white paper, particularly regarding casino reforms, it stresses the urgency of implementing these reforms to facilitate hiring and growth within the sector. The white paper’s proposals cover affordability checks, sports betting, and machine numbers, all crucial for the industry’s viability.

In related news, Chancellor Hunt’s Autumn Statement also hinted at a consultation to unify the structure of remote gambling taxation. The current system comprises three taxes: remote gaming duty, general betting duty, and pool betting duty. This consultation aims to simplify the tax structure, affecting gambling offered via the internet, telephone, TV, and radio.

As the industry navigates these regulatory and economic challenges, the BGC’s call for a re-think on gaming duty bands and the swift implementation of proposed reforms becomes increasingly critical for the survival and prosperity of the UK’s casino sector.