Betting and Gaming Council Advocates for Mandatory Tiered Levy on Betting Providers

06.04.2023

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Carl Hughes Betting Expert

Updated:April 6, 2023

“Surprise, surprise!” are the words betting and gaming industry experts in the United Kingdom have been using when told that the White Paper on UK gambling has been delayed again. The much anticipated document is supposed to carry out a comprehensive review of the industry and make recommendations for its improvement and modernisation. It has already been severely delayed several times, and was last expected to be published in the first quarter of 2023, but this deadline was also missed due to a number of issues that still require to be ironed out. An example of such an issue is the rules surrounding sponsorship and advertising deals between Premier League clubs and betting sites, which is currently being reviewed.

One of the topics that expected to be discussed in the White Paper is that of a mandatory levy imposed on UK betting sites and bookmakers. At present, the majority of UK betting sites pay a voluntary contribution to the Betting and Gaming council, which is the country’s sui generis trade association for betting and gaming. The money is used to fund independent charities for the purposes of RET – research, education, and treatment in the field of harm caused by betting and gaming. At present, this stands at 1% of the annual revenue generated by betting sites and bookmakers. All signs suggest that the White Paper will recognise the benefits of this levy and will make it mandatory for all licenced betting sites in the United Kingdom.

At present, about 85% of people in the UK who have been affected by the harm caused by gambling and receive treatment for gambling addictions do so through an independent network of UK charities. These charities are funded by the voluntary levy paid by betting sites and bookmakers. While 1% donation is the minimum recommended by the Betting and Gaming Council, it points out that the four top UK betting sites donate a lot more, and are expected to have increase their donations by £110m between 2019 and 2014. The funds are allocated solely through the discretion of the Council, and the donors have no influence over what their money is used for. The Council has been lobbying to make the levy mandatory for some time now, however it has also emphasised that the allocation of funds should remain unchanged.

The Betting and Gaming Council has stated that it supports a mandatory levy, however has cautioned the Government to get it right or risk jeopardising retail physical betting and gaming locations. As a large number of betting now takes places online, via betting sites, land-based bookmakers in the UK have already seen a significant decrease in their revenue. The CoVID-19 pandemic did not help them as the social isolation rules meant that a lot of betting shops had to close for a long period of time, which sent even more customers on a quest to find betting and gaming alternatives, usually through betting sites.

The Betting and Gaming Council CEO Michael Dugher commented:

“BGC is concerned the government may announce in its forthcoming white paper a blanket 1% fee on all members. […]BGC industry analysis suggests a new blanket 1% statutory levy to land-based operators would be the equivalent of between a 10% and 15% hit on post-tax profits, because of the fixed costs which do not equally apply to online operators.”

Dugher pointed out that betting shops already struggle in the current economic climate and may not survive the pressure of having to pay an unfair proportion of the levy.  He also wrote strongly about what the funds should be used for, stating that it is irrelevant how they were raised (i.e. through the activities of betting sites and bookmakers) when it was obvious how beneficial they were to funding the “exceptional” work of gambling harm charities. He stated that this is what the funds should be used for, and not for funding the work of lobbyists who are trying to eradicate betting and gaming altogether. Finally, the Council released figures to show the importance of betting shops and physical gambling locations, demonstrating that land-based betting supports 42,000 jobs, and land-based casinos support further 15,000 jobs. The 1% voluntary levy is in addition to £4.2b that the licenced betting and gaming industry pays in taxes every year.

Others are of the opinion that 1% is not enough. Christian organisation CARE is calling for 5% levy for all betting providers. According to the organisation’s Gambling Policy Lead Tim Cairns, those affected by gambling harm require more funds to recover, and the NHS does not benefit from the voluntary levy as it refuses to accept the money on ethical grounds. According to CARE, there is one gambling-related suicide in the UK every day, and the high cost gambling inflicts on society and local communities needs to be funded through a bigger levy. CARE estimates that the NHS requires £240m a year to treat gambling harm. It is important to point out, however, that some of the tax collected from the betting and gaming industry does go towards funding the NHS.

While there are strong rumours that the mandatory levy policy will be introduced in the UK, nothing is certain yet. Some point out that the Prime Minister Rishi Sunak was opposed to the idea when he was Chancellor of the Exchequer. It is also important to remember that the White Paper itself is not going to introduce legislation – rather, it will propose legislation which will be slowly brought in afterwards.

About the author

Carl Hughes

Editor

Carl Hughes

Editor

Carl Hughes is a leading expert on sports and casino betting. Carl began his career with a BSc in Sport, Exercise and Health Sciences from the University of Birmingham before working within the industry for some of the bigger names (GVC and Bet365) and has been praised as being "a leading sports betting commentator".