Leaked Gambling Paper Information Reveals Plans for Mandatory Gambling Harm Levy
While the UK Government continues its radio silence on the issue of when the long-delayed White Paper on UK gambling would be published, all interested parties are tensely speculating over the changes that such a comprehensive review would bring. A number of questions remain unanswered, and some of these are in relation to topics continually taking the spotlight, such as tax, advertising, and social responsibility. Leading UK betting sites have already started preparing for the anticipated changes, however the action they can take is limited pending the release of the full details of proposed changes and legislation. It is, therefore, no surprise, that some of the White Paper’s contents have been leaked to the media by insiders, revealing more information on one of the most controversial issues contained in the White Paper – that of a mandatory levy for the treatment of gambling harm.
Such a levy has been long discussed by those involved in the gambling industry in the UK. The UK Betting and Gaming Council, an industry regulatory body, has been collecting a voluntary levy from its members, which represent 90% of all licenced betting sites and bookmakers in the UK, including all the biggest betting providers such as Entain, bet365, Kindred, and 888. The levy is currently 1% of the company’s annual profit, and the proceeds are distributed to charities who support and treat gambling addiction and the associated harms. The UK Betting and Gaming Council has full discretion over the distribution of the funds.
Now, according to the leaked information from the gambling review, this levy will almost certainly become mandatory. The leaked report does not specify exactly how much UK betting sites and land-based betting providers will have to pay, however it is believed that the levy will stay around 1%. The UK Betting and Gaming Council has already released a statement, saying that 1% flat rate is unsustainable. According to the Council, those of its members such as large UK betting sites who can afford to pay more, already do so. On the other hand, land-based bookmakers who have still not fully recovered from the effects of the CoVID-19 pandemic and are struggling due to the cost of living crisis are expected to find the levy of 1% of their annual profit unmanageable when added to the usual taxes and fees they pay every year.
Experts suggest that some of the money collected through the levy may be used to cover the expenses of the NHS in relation to gambling harm and addictions, however it is important to point out that the NHS has so far refused to benefit from the voluntary levy, citing ethical grounds. According to official statistics, gambling harm costs the Government over £1bn per year due to its health, societal, and local community impacts. Meanwhile, the UK has one of the largest betting and gaming industries in the world, and in 2020 betting sites and bookmakers made a profit of £14.2bn. The Government collects about £4.2bn in tax from the betting and gaming industry each year, and part of this goes to fund the NHS. It is not clear how the NHS will take to a newly-introduced, mandatory levy to tackle gambling harm, however an article published in The British Medical Journal on 6th April 2023 claims that such a levy may do more harm than good. The article states:
“A levy also diverts attention away from advertising controls and product regulation, an approach that could be expected to be more effective. […] If a levy deflects questions about how much harm should be tolerated and on what grounds, it risks doing more harm than good.”
According to the leaked report, the UK Government is also considering several strict restrictions on how much customers can afford to wager when using betting sites. It is expected that those under 25 will not be able to bet more than £2 per a single spin. Meanwhile, older bettors will be able to bet £15, however this is subject to various safer gambling and Know Your Customer checks that would establish each bettor’s personal affordability levels. Finally, the leaked report suggests that the White Paper will ensure proper funding for British horse-racing, and that a percentage of the profit made by betting sites and bookmakers from horse-racing bets will go to fund the sport. It is not clear exactly how much this will be and how this will be implemented.
In other news, a serving UK Conservative Member of Parliament Scott Benton is being investigated in a new scandal. The MP was filmed at a meeting with what he believed to be representatives of a gambling company, during which time he offered to lobby for the company in Parliament in exchange for hefty payments. The representatives were, in fact, investigative journalists who had set up a fake bookmaker for the purposes of speaking with Benton. As UK MPs are not allowed to lobby for anyone, Benton has been suspended while the investigation is ongoing.
While the above topics and issues are fairly controversial, experts agree that nothing good will come from delaying the White Paper any further, and that betting sites and operators require clarity in order to operate in an already uncertain climate that is harming the industry.