UK Government urges casino sector to revamp rules to guarantee its survival
More jobs and businesses will be at risk if the UK Government neglects to modernize its policies and usher in a new era for the casino sector, according to NoDeposit365.co.uk
The gambling landscape has witnessed significant transformations, and the advent of new data and technology presents both increased risks to players and opportunities for innovative protective measures. The dynamics of land-based gambling have also evolved considerably, rendering some assumptions from 18 years ago increasingly outdated.
Currently, the UK gambling landscape is lagging behind the broader gambling ecosystem. David Williams of Rank Group emphasizes that the industry's survival hinges on the implementation of new legislations, which must precede the increase in the national living wage and the expected impact of freezing casino duty bands. The latter is estimated to cost the sector £5 million per year.
According to Williams, the industry can only weather these escalating costs if the policies outlined in the white paper are implemented first. These policies encompass changes to gaming machine allocations, permitting casinos to offer sports betting, and expanding electronic payment methods, among other crucial alterations.
Ongoing discussions
Released in April, the Gambling Act review white paper details the regulatory framework for gambling in the UK. The Gambling Commission is currently reviewing various proposals outlined in the white paper, with the initiation of the first consultation in July. The BGC has expressed overall support for the government's gambling white paper, particularly regarding casino reform. The white paper encompasses suggestions on affordability checks, sports betting, and the number of gaming machines.
The first round of discussions, which was concluded last October, focused on financial risk and vulnerability, where age verification procedures would be enhanced at land-based casinos. As for the next session, which is set to conclude between February and March, an array of different subjects are on the agenda: including promotional deals such as the UK casino bonuses offered at online casinos.
A total of over 3,000 submissions were received. The upcoming round of consultations addresses seven topics, including the option to opt in for online bonuses. Tim Miller, the executive director of policy at the Commission, mentioned that this round is expected to conclude in February or March.
Stealth tax raid
In November 2023, the Betting and Gambling Council (BGC), accused the UK government of implementing a stealth tax raid on casinos, estimating that it could incur a cost of £5 million per year for the industry. This claim follows the decision to freeze gaming duty bands, as outlined in Chancellor of the Exchequer Jeremy Hunt's autumn statement.
Hunt announced plans for the government to consolidate remote gambling into a single tax, replacing the existing three-tax system. The proposed changes aim to redefine the taxation structure for remote gambling, which encompasses gambling services offered over the internet, telephone, TV, and radio. The consultation, expected to commence shortly, will explore the elimination of the current three-tax structure, consisting of remote gaming duty, general betting duty, and pool betting duty.
Cause for concern
The BGC noted that those in the land-based casino sector had anticipated an increase in the bands corresponding to inflation. The freeze in gaming duty bands will effectively result in a £25 million tax increase for casinos over the next five years. Michael Dugher, the Chief Executive of the BGC, has previously argued that this increased tax rate has the potential to impede recovery and weaken future growth, which could have detrimental effects further down the line.
Furthermore, the BGC highlighted that casinos contribute £300 million in taxes each year, adding to an estimated £800 million in gross value across the entire economy. However, casinos have encountered significant challenges, including the cost-of-living crisis, leading to the closure of four casinos in recent months. Additionally, the sector now employs 25% fewer workers compared to just four years ago. Since 2005, one in four casinos has shut down, leaving only 117 remaining across the country.
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