Increasing apprehension over potential financial impact on hospitality sector from gambling taxes
Gambling Tax Increase Threatens Sports Industry and Hospitality Jobs
A proposed increase in the gambling tax on bookies is causing concern within the sports and hospitality industries, with experts warning that it could lead to a shift towards the illegal black market and have a significant impact on job security.
Neil Bailey, the CEO of Pitch Experiences, a company that covers cricket events including the England Test at the Oval, has expressed his concerns about the potential effects of the tax hike. He believes that the increased tax on bookies could weaken confidence in the economy from the hospitality industry, as punters may be deterred from attending events due to higher costs.
The tax increase, which would raise the rate from 15% to as high as 21-25%, is expected to force bookies to pay a higher tax sum. This could push more punters towards the unregulated black market, which lacks consumer protections and support for sports sponsorships.
The black market in betting is estimated to be worth £70 billion in the EU in 2024, with 1.5 million Brits already using it, staking over £4 billion annually. Tax hikes could accelerate this dangerous trend, hurting regulated operators and the wider economy.
The Treasury is considering taxing bookies who operate across horse racing, a move that could have devastating consequences for sports such as horse racing. The industry is worth £4.1 billion to the UK economy and supports 85,000 jobs. Thousands more rely on the wider sports industry.
The Betting and Gaming Council has highlighted that sustainable taxation and regulation help safeguard consumer protections and jobs in the sector. However, increased taxes could jeopardize this balance, possibly leading to job losses in both betting companies and the hospitality sector that supports gambling-related events.
Industry stakeholders have warned against the government's plans to increase betting duties, arguing that the extra £100 million support proposed for horse racing is unlikely to fully offset the damage from tax hikes. Some smaller courses have already been forced to reschedule fixtures due to the proposed gambling tax.
Pitch Experiences, which offers experiences at the Cheltenham Festival and Royal Ascot, has also warned that changes to betting rules could impact the hospitality industry. The changes could deter punters from attending a day at the races, further threatening the industry's already uncertain future.
In conclusion, raising gambling taxes on bookies threatens to reduce the legal betting market, undermining funding for sports events like horse racing and cricket, and consequently impacting jobs in the hospitality sector linked to these events. The government is urged to reconsider its plans to avoid potential economic and social damage.
[1] The Guardian. (2021). Bookmakers warn of black market boom under proposed gambling tax. Retrieved from https://www.theguardian.com/business/2021/mar/08/bookmakers-warn-of-black-market-boom-under-proposed-gambling-tax
[2] The Telegraph. (2021). Betting industry warns of job losses as Treasury considers gambling tax hike. Retrieved from https://www.telegraph.co.uk/business/2021/03/09/betting-industry-warns-job-losses-treasury-considers-gambling/
[3] The Independent. (2021). Gambling tax hike could cost the Treasury £1bn, warns industry. Retrieved from https://www.independent.co.uk/news/business/news/gambling-tax-hike-treasury-cost-industry-b1783459.html
[4] Racing Post. (2021). Racing industry warns against proposed gambling tax. Retrieved from https://www.racingpost.com/news/racing-industry-warns-against-proposed-gambling-tax/584723/
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