Bookmakers warn tax rise in autumn budget could force closures

Britain’s biggest bookmakers have warned that a tax rise in the autumn budget could close up to 1,470 betting shops and cost as many as 15,900 jobs. The chief executives of Entain, Flutter UK & Ireland, bet365, Bally’s, Evoke and Betfred have written to the chancellor, John Healey, asking him to rule out higher gambling duties when he delivers his first budget on 28 October, according to the Racing Post and Sky News.

The Guardian reported that Mr Healey is understood to be considering doubling machine games duty (MGD) from 20% to 40%. Fred Done, the Betfred chairman, said any increase “will mean a bloodbath in terms of shop closures, job losses, and a free pass for the black market”.

High street bookmakers threatened with closures

The industry says betting shop staff would be among those most exposed. The Betting and Gaming Council (BGC) said the shops support more than 36,000 jobs, with over 80% based outside London in market towns, former industrial areas and seaside towns. It said 19% of employees are under 25, against 11% across the wider economy, and half of the workforce are women.

The executives’ letter said 23% of the closures would fall in the north of England. It also claimed that half of the local gambling venues in Makerfield, the constituency of prime minister Andy Burnham, would shut.

“Every shop we close leaves a hole in its community,” Mr Done said. “When they’re gone, they won’t come back – and neither will the jobs.” Grainne Hurst, the BGC’s chief executive, said: “This Budget must back Britain’s betting shops, not cost our towns thousands more jobs.”

What the numbers show on the gambling tax increase

The industry’s figures come from EY analysis commissioned by the BGC, as described in the letter seen by the Racing Post.

The letter said the net cost to the Exchequer, once losses from other taxes are counted, could reach £124m. The Social Market Foundation thinktank, however, has said doubling the duty could raise up to £460m, the Guardian reported.

As a worked example, the Guardian said £54m of the roughly £400m in tax the Done family paid last year was MGD, according to Betfred Group Holdings’ accounts. At 40%, that sum would in theory double to £108m, before any closures.

The industry also points to last year. Rachel Reeves raised remote gaming duty from 21% to 40%, and the letter said more than 600 betting shops have since closed and 10,250 jobs have been lost or earmarked for redundancy. General betting duty on online bets is due to rise from 15% to 25% on 1 April, with racing exempt.

The counter-arguments and what happens next

Not everyone accepts the warnings. The Commons Treasury Committee urged the then chancellor to resist “industry scaremongering” and raise gambling taxes, including MGD, as reported by the Daily Mirror.

The Guardian noted that Betfred has announced plans to close nearly 1,000 shops since 2019, while its estate fell from about 1,620 to 1,293 amid a shift online. It reported that the company’s accounts show a record £996m won from punters, a £64m pre-tax profit and a £30m dividend. Some industry figures told the paper that adult gaming centres, with lower overheads, could even gain if rivals retrench.

The next date is 28 October, when Mr Healey sets out his budget. The bookmakers have also asked him to pause the April general betting duty rise until the effect of last year’s increase has been assessed.

Your questions answered

How much money does the UK government make in taxes from gambling?

The BGC said the regulated betting and gaming industry generates more than £4bn a year in tax revenue and supports 109,000 jobs. That is an industry body’s figure, not a Treasury one.

Is tax going up to 22%?

None of the sources mention a 22% rate. MGD is currently 20%, and the reported proposal is to raise it to 40%. Nothing has been confirmed by the government.

How much would a 2p tax rise raise?

The sources give no figure for a 2p rise. As a rough guide only, the Social Market Foundation’s estimate of up to £460m for a 20-point increase implies at most about £23m per point, or about £46m for two points. That is our arithmetic, and it ignores any closures.