BUSINESS

UK to hike Remote Gaming Duty before slashing FOBT stakes

TAGs: Fixed Odds Betting Terminals

uk-remote-gaming-duty-tax-hikeUK online gambling taxes will be hiked before the government gets around to slashing the maximum stake on fixed-odds betting terminals (FOBT).

On Friday, UK media reported that the Treasury had agreed to delay the reduction in maximum FOBT stakes from their current £100 to just £2 until April 2020. The government justified the delay by saying that it was attempting to “balance the needs” of problem gamblers and industry staff by allowing the industry “sufficient time to implement these technological changes.”

Labour Party members were predictably outraged, with MP Carolyn Harris saying she was “breathing fire” over the announcement. Labour deputy leader Tom Watson called the delay “a pathetic move from a fundamentally weak government.”

Anti-gambling campaigners were equally miffed, noting that the companies that make FOBTs needed only a couple months to make the necessary changes, allegedly poking holes in the government’s claim that the industry needed two years to make the switch.

The delay could add an additional £4b to bookmakers’ revenue, given that the annual take from FOBTs is roughly £1.8b. But Friday’s news wasn’t all gravy, because when the government announced its FOBT plans last month, they also announced that the Treasury would make up the expected tax revenue shortfall by hiking the Remote Gaming Duty.

The government has reportedly signaled that the online hike could take effect with the delivery of the next budget in April 2019. Online gambling operators had expected the government to proceed simultaneously with the land-based and online changes.

The UK currently taxes online operators at 15% of revenue derived from local punters. The government has yet to specify how high of a hike it’s contemplating, but The Times suggested it would be lower than some industry members feared. The hike will also only apply to online casino gaming, not sports betting.

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