UK government - Gambling tax increase

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UK government considering a major increase in gambling tax The UK government announced last week that it is considering a major increase in gambling tax.
According to Labour, an increase in gambling tax from 21% to 50% for online casinos would bring in £3 billion (€3.58 billion) for the public purse.

In order to plug a £22 billion gap in the public purse, the UK government is looking for additional revenue.
One of the options being considered by the UK government is a major increase in gambling tax.
This would follow the example of the Netherlands, where gambling tax will increase from 30.5% to 37.8% in two steps.

According to The Guardian, the Treasury is considering proposals that could see the gambling tax for online casinos and bookmakers more than double to 50%.
Sources have told the British newspaper that the government has not yet made a decision,
but that they are open to changing the tax system for (online) gambling in the United Kingdom.

The increase should bring an additional £900 million to £3 billion to the state coffers. According to one of the anonymous sources, it is definitely on the cards,
and there is no clear resistance to it from the British government.

One of the proponents of the increase is former poker player Derk Webb, who has been working on gambling reform for years.
He has already donated £1.3 million to the Labour Party since 2023, while Labour members have also received gifts from gambling companies.

Gambling tax increase

The report by the Institute for Public Policy Research (IPPR) think tank estimates that doubling the tax on “harmful products” such as online casino games would raise an extra £2.9 billion next year, rising to £3.4 billion annually over six years.

The think tank proposes no increase in taxes on low-risk games of chance such as bingo and lotteries,
while the tax on physical bookmakers would be doubled from 15% to 30%.
The tax on online providers would have to be drastically increased, from 21% to 50%, according to the think tank.

“We suggest that this is the best application of the ‘polluter pays’ principle and will encourage companies to focus on products that are less harmful.”

IPPR think tank

The Social Market Foundation think tank has opted for a slightly milder proposal, with an increase from 21% to 42% for online gambling companies.
A spokesperson for the Betting and Gaming Council (BGC) told The Guardian that they are still strongly opposed to a higher gambling tax.
The spokesperson indicates that comparable markets abroad that have taken a similar step are seeing a spike in illegal gambling.

Alun Bowden, analyst of the European online gambling sector for Eilers & Krejcik Gaming,
has added some nuance to the rumours of a gambling tax increase on his LinkedIn page.

He is surprised that the suggestion has been taken so seriously, and calls a tax rate of 50% a rather unlikely outcome.

Bowden therefore wonders what the reasoning behind such a decision will be
 
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