The Betting and Gaming Council (BGC) has once again reiterated its stance on any increases to the existing gambling tax in the United Kingdom. The trade group has cautioned that the passage of such measures could result in the loss of hundreds of thousands of jobs and billions of pounds.
Talks of a gambling tax increase have the industry sounding an alarm
To help illustrate the point, the BGC has reached out to EY, a research firm, to gauge the potential impact of a rumored tax increase spearheaded by the current government, on advice by the SMF and IPPR think tanks, arguing that the intended consequences would seriously harm the market.
This harm would translate into consumers turning to black market operators, and 40,000 jobs being lost. In fact, the BGC and EY go a step further to suggest that as much as £8.4bn could be channeled through black market operators if an intended tax increase goes through.
Talk of a tax increase already has the largest high street companies up in arms, with most resigned to the incoming tax, and announcing betting shop closures, which are already costing jobs. In one instance, a company has said it would shutter its entire retail chain, resulting in 7,000 job losses. Evoke and Etain have confirmed similar measures.
The BGC argues that the gambling industry currently contributes £4bn in tax and supports more than 109,000 jobs across the nation. Yet, a tax increase could nearly halve that. There is more at stake, too, as the gambling industry has spawned a tech industry around itself, leading to innovation and training high-impact workers.
Commenting on the idea of a higher tax, BGC Chief Executive, Grainne Hurst, said:
"It is now clear these further tax rises are a direct threat to British jobs and economic growth. The figures speak for themselves - tens of thousands of jobs lost, billions diverted to the black market, and a possible £3 billion hit to the economy.
Tax raids like those proposed would mean fewer betting shops, casinos, and bingo halls, fewer jobs, and a huge boost to the growing, unsafe gambling black market, while not raising anywhere near the tax claimed."
Short-term gains are a palliative for the long-term damage, BGC argues
Hurst insists that the BGC stance does not come out of place of being overly-friendly to the gambling industry, but rather because of understanding how the measure would work.
Hurst acquiesces that there may be short-term gains, but the mid-to-long-term would look worse, as consumers will start withdrawing from the regulated market, looking for offshore bookmakers that simply offer better overall odds.
The BGC also disagrees with the IPPR’s estimated gain of £3.2bn in revenue. Based on EY’s report, the short-term gains are expected to be closer to£1bn, as outlined in EY’s report.
