Betfred is the latest to join the closure club, as they have warned all of their stores could close if the gambling tax increase happens next month.
Betfred joins the likes of William Hill and Ladbrokes who are suggesting the proposed tax increases on gambling proposed by Labour MPs in September could cause closures. Paddy Power has sadly announced the closure of 29 UK shops over “challenging market conditions”.
Betfred’s founder, Fred Done, warned that all 1,287 of the betting brand’s stores could close in the UK, should the tax rise occur.
Done claimed the tax increase is the “biggest threat” that Betfred has faced in 50 years in an interview with the BBC.
No plans have been announced by Chancellor of the Exechequer Rachel Reeves concerning tax increases, but UK betting giants are incredibly worried.
Key industry figures have warned the government against raising the taxes to such a high amount.
If the tax increase goes ahead, sports betting firms could pay 30%, double the current level of 15%, and from 20% to 50% for selected online games, including slots.
What Else Did Done Say?
Done, who founded Betfred in 1967, also said the tax could result in 7,500 redundancies. There has been a lot of speculation over how the taxes could affect igaming, and at this rate, it doesn’t look good.
Done claimed that profits were already down, and any tax increase will make operating Betfred stores impossible.
The government is firmly onboard with the changes, with former Prime Minister Gordon Brown championing the Labour proposal. Even Reeves said there there is “a case for gambling firms paying more”.
BetFred’s current tax amounts include:
- 15% general betting duty on sports wagers.
- 20% on gaming machines.
- 21% on online casino wagers.
The founder said he thinks that any increase in this tax will result in virtually no profits for the business, which would force the closure.
He also added that profit losses in select Betfred stores would increase, as hundreds of stores are already losing substantial amounts of money.
Like many other betting industry figures, Done warned the tax increase will increase the number of players using offshore and black market platforms. The UKGC has already studied the playing habits of those who use these sites, and highlighted the reasons for using them.
While tax increases and regulatory changes did not rank among the common reasons players used these sites, there is a geunine concern that such a high tax increase could push players into the arms of some of these platforms.
Again, no announcements by the UK government have been made over the dreaded tax increases.
We will stay hot on the heels of any updates regarding the tax increase saga.
