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A group of more than 100 Labour MPs have submitted a letter to Chancellor Rachel Reeves suggesting she should increase the gambling tax and use the additional capital to help in the fight against child poverty. The letter, which was penned by Alex Ballinger and Dr Beccy Cooper, and included 101 signatories, suggests the move would enable the Prime Minister to meet the growing calls to scrap the two-child benefit cap.
The participating MPs further suggested that the money raised should be ringfenced to specifically deal with the emotive issue of child poverty.
The UK has one of the most regulated gambling markets in the world, with a well-established framework. UKGC-licensed operators must collect extensive personal details from users and register with the self-exclusion program Gamstop.
Licensed UK casino sites are concerned that any increase in tax will push more gamblers to these websites. And some commentators have warned that this could have a detrimental effect on the amount of tax revenue raised.
Something similar happened in the Dutch market. Tax rates were raised to 34.2% at the beginning of this year, and, since then, tax revenue has declined across the board.
Under proposals put forward by the Institute for Public Policy Research, the government would put UK tax rates up even higher than in the Netherlands. They have proposed increasing rates from 21% to 50%, claiming it would raise £1.88bn.
The Liberal Democrats have not gone quite as far but have proposed an increase to 42%, which would still mean the UK faces the highest gambling tax rates in Europe.
In the US, some gambling companies have started to add extra player fees on bets taken. DraftKings, for example, has introduced a $0.50 fee on every sports bet taken in Illinois after the state added a per-bet tax on licensed operators.
When discussing the newly introduced player bet fees, Flutter’s CEO Peter Jackson emphasized that gaming tax rates work best at a balanced level — one that lets operators maintain a strong customer experience, supports overall market expansion, and ensures sustainable revenue for state governments.
Even if betting companies do not explicitly add a fee per wager here in the UK, the decreased profits companies make will mean they will have to take some action to increase revenue and reduce overheads. That is likely to come at the cost of reduced bonuses, lower prices, and other changes that will prove detrimental to UK punters.
David Prior
David Prior is the editor of Today News, responsible for the overall editorial strategy. He is an NCTJ-qualified journalist with over 20 years’ experience, and is also editor of the award-winning hyperlocal news title Altrincham Today. His LinkedIn profile is here.
