The UK gambling sector made an extra £1bn from punters in the year to March, according to new data expected to buoy calls for the chancellor to raise betting taxes in Wednesday’s budget.
Betting companies made £12.6bn from services excluding lotteries in the latest 12-month reporting period, the Gambling Commission revealed on Tuesday, a 9.3% rise on the £11.5bn the industry made during the previous year.
The numbers were inflated by an almost 15% increase in gross gambling yield from online casino players, which rose to £5bn from £4.4bn during the previous period, and is now 55% higher than at the start of the 2020 Covid-19 pandemic.
Online casino games have been criticised for being one of the most addictive forms of gambling available in the UK, leading to calls for a rise in online gaming duty by campaigners including the former prime minister Gordon Brown.
Iain Duncan Smith, chair of a cross-parliamentary group examining gambling harm, said gambling companies were making “vast and growing profits”.
“Uniquely, gambling companies make their profits through highly addictive products, often from our most deprived communities,” he said. “It is abundantly clear that more addictive forms of gambling like online casinos and machines in adult gaming centres should be taxed at a higher level to pay for the many social ills that they cause.”
Meg Hillier, the chair of parliament’s Treasury committee, which has been examining gambling taxes, said: “We believe that addictive online betting should face higher taxes than forms of gambling with cultural benefits, such as horse racing and bingo halls.
“It’s important that the government does not cave in to … industry scaremongering [about higher gambling taxes causing job losses]. Unfortunately, the fact that we are told the existence of gambling firms is on a financial knife-edge, while they simultaneously plough billions into advertising, does not come as a surprise.”
The gambling industry has been lobbying the Treasury in an apparent effort to persuade Rachael Reeves to shy away from announcing large rises in a range of betting duties during her set-piece speech to the Commons on Wednesday.
The industry has the backing of some powerful supporters, with the Sun running a campaign called Save Our Bets. Last week, the tabloid reported that Joanne Whittaker, the chief executive of the bookmaking chain Betfred, had argued that even a modest increase to machine games duty – levied on machines located in premises that give cash prizes such as slot and quiz machines – would have a “devastating impact” and significantly cut the industry’s tax contribution, rather than contribute more revenue to the Treasury.
Betfred has said it would close all 1,287 of its high street betting shops if Reeves raised taxes on the gambling industry. Evoke, the company behind William Hill, also said last month it was considering closing up to 200 betting shops if the chancellor raised taxes on the sector.
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Elsewhere in the data, adult gaming centres (AGCs) reported that their winnings rose by 10% during the 12 months to March, with the industry making £682.9m from its customers, up from £623.3m.
AGCs have attracted the attention of some anti-gambling campaign groups because they appear to target poorer areas of the country and have been criticised for failing to help problem gamblers self-exclude. The number of AGCs fell slightly during the year from 1,451 to 1,415, while the total number of premises – which include betting shops, bingo halls and casinos – edged down from 8,328 to 8,234.
The Betting and Gaming Council warned that the regulator’s latest figures masked “a mixed picture” in the sector, where high street operations such as betting shops had reported more than 30 closures during the current quarter.
A spokesperson for the industry body said: “These statistics also do not capture recent regulatory changes, which will have a major impact on growth and jobs, including a new £100m levy to fund research, prevention and treatment to tackle problem gambling and gambling related harm, and new financial vulnerability checks introduced in February.
“BGC members generate £6.8bn for the economy, contribute over £4bn in tax and support 109,000 jobs, while sustaining local economies and sports. Ministers should take care in the budget not to impose measures that weaken the regulated sector and strengthen the unsafe, unregulated gambling black market, which pays no tax and offers none of the protections that exist in the regulated sector.”
