Retail Decline
Betfred co-founder and Chairman, Fred Done, has cautioned that the bookmaker’s 1,287 betting shops may be forced to close if Chancellor Rachel Reeves increases gambling taxes in the forthcoming autumn budget. He said the closures could put 7,500 jobs at risk, describing the potential tax hike as the “biggest threat” he has faced in 57 years in the industry.
Betfred operates more than 1,200 betting shops in the UK alongside an expanding online platform. Done said that while the company took in nearly £1 billion in revenue last year, it made an operating profit of £500,000 after several writedowns on its assets.
He added that 300 of Betfred’s shops are currently losing money, warning that a 5% increase in duties would bring that number to 430. Betfred currently has between 1,200 and 1,400 betting shops in the UK.
Done said that the rate doesn’t need to reach 50% to cause the closure of Betfred shops. He believes that if duties were raised to 35% there would be no profit in the business and that they would have to close down.
Unlicensed Market Danger
He added that betting activity would continue even if the UK betting industry wasclosed down. He said that higher taxes would drive customers to offshore bookmakers who don’t pay towards UK tax.
The gambling industry currently pays multiple taxes, including 15% general betting duty on sports betting and horseracing, and a 20% duty on casino games. Done said that increases to National Insurance contributions and the minimum wage had already added £20 million to Betfred’s costs.
Chancellor Rachel Reeves recently told ITV there is “a case for gambling firms paying more” and that gambling companies “should pay their fair share of taxes.” She has been urged by former Prime Minister Gordon Brown to raise gambling duties and use the revenue to reduce child poverty.
The Institute for Public Policy Research (IPPR), a left-leaning think tank, estimated that higher taxes on the industry could raise £3.2bn for the UK public every year. However, the Betting and Gaming Council, which represents UK gambling operators, called the proposal “economically reckless.”
