BGC Raises Concerns over UK Government Casino Stealth Tax
LISTEN TO THIS ARTICLE:The Betting and Gaming Council (BGC) has announced that its members object to a tax measure introduced by the United Kingdom (UK) government, which has been classed as a stealth tax on land-based casinos in the region.
During a speech on the upcoming budget for the UK, the Chancellor said that Gaming Duty Bands, relating to tax, for brick-and-mortar casinos in the country, will be frozen for the coming year. These bands would usually be raised in line with inflation, and during the relatively high inflation in the UK, it amounts to a tax on UK casinos. The BGC estimates this measure will cost retail casinos in the UK approximately £5 million across the industry.
Freezing Gaming Duty Bands is a stealth tax that has the potential to slow recovery and weaken future growth. Removing it would have provided a welcome boost for the land-based casino sector at a crucial time. It seems short-sighted to maintain this stealth tax while failing to make changes that will allow casinos to hire and grow. The BGC urges a rethink so Gaming Duty Bands can be moved with inflation at the next opportunity.
Economic Factors Affecting UK Casinos
Land-based casinos are seen as a big part of the tourism and entertainment industry in the UK. The gaming operators in the jurisdiction raise a figure of £300m annually in taxes, and customers contribute up to £800m a year of Gross Value Added to the economy.
Challenging economic conditions including COVID-19 and a rising costs have led to the current number of casinos in the UK standing at 117, which is down from 160 casinos in the region in 2005. The BGC points out that 4 of these have closed within recent months.
The casinos have tried to streamline their operations, and the industry has seen a 25% reduction in staffing numbers to 10,200, down from 13,600 in 2019. With the casino industry struggling, the BGC hopes the UK government will remove the freeze on Gaming Duty Brands, which will cost the UK casinos an estimated £25 million over five years.
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