Online casinos and bingo rooms licensed in the United Kingdom may need to adjust their budgets and promotions to take into account a 15% general betting duty to be levied on them beginning August 17, 2017. Chancellor George Osborne (pictured) revealed the duty as part of the UK government’s most recent proposed budget Wednesday. As of press time budget details had not been published, but the additional tax would bring online operators more in line with what sports betting sites currently pay. Casinos and bingo operators have already been paying a 15% point-of-consumption tax since new gaming regulations came into effect in 2014. The duties apply only to bets made by bettors residing in the UK.
High street bookies were expecting changes to the duty on fixed odds betting terminals (FOBT) but haven’t heard the bad news yet, so that probably means they will get a free ride this session. The machines are a source of controversy in the country with many calling for lower betting limits. Bets on the machines can go as high as £100. No further online advertising restrictions were announced either, much to operators surprise. Ladbrokes shares rose more than 7% on the news, the biggest rise in almost 5 months. Others also saw increases in value, most notably William Hill which gained 4.3%. Last month Ladbrokes posted a 46% fall in pretax profit, mostly attributed to regulations and duties.
Not all operators are experiencing difficulties. Last June the government released revenue figures for the year ending September 2014 for all sectors including brick and mortar but excluding lottery. The report showed the entire UK gambling industry was worth a staggering £7.1 billion. Online bingo operators saw a slight decrease year on year which may account for an increase in free bet offers we’re seeing now.
Although there is no certainty the current budget will be passed as proposed, many pundits are predicting a high likelihood of the free bet tax coming into effect in August as planned by the bill’s authors.