The gambling industry of United Kingdom managed to avoid a tax rate increase in the Labour government’s autumn budget. It was announced last October 30.
Budget filings did state the government would consider how to merge the gambling tax structure of United Kingdom. Currently, remote gaming and betting have different tax rates. Sports betting has its own 15% charge for net stake receipts.
It has been first reported by The Guardian that the government was considering a UK gambling tax increase on October 11. One by the IPPR or Institute for Public Policy Research suggested increasing the UK’s RGD or remote gaming duty to 50% of operator profits, from its current rate of 21%.
The second suggestion came from the SMF or Social Market Foundation. One of the proposals called for raising the remote gaming duty to 42%. Such an increase would raise an estimate of £900 million or €1.1 billion or $1.2 million in additional tax refunds.
The industry considered the tax hike proposals absurd. Yet, the report had an immediate impact on the market. Publicly listed shares swiftly decreased by up to 16%.
Politicians and gambling industry heavyweights heavily criticized the motion. They insist it could have far-reaching implications on the horseracing and sports sectors in the United Kingdom.
The Betting and Gaming Council (BGC) warned that the increase could resemble disproportionate tax regimes seen in other regions. This includes contributions of employers to national insurance and capital gains tax or CGT. According to Reeves, the government is targeting to raise taxes across the board by £40 billion. This includes a 50% increase on the duty for private jets.
