The chancellor has been urged to ignore "scaremongering" by gambling firms and raise taxes on the most harmful products in the £11bn sector, according to a report by the Treasury select committee. MPs said Rachel Reeves's team should impose higher duties on addictive forms such as high-street slot machines and online casino games, which they said are growing rapidly.
The report accused the industry of hiding its more "insidious" products behind traditional activities like horse racing and seaside arcades. It echoed calls from thinktanks and Gordon Brown, who has said gambling taxes should rise by £3bn to fund an end to the two-child benefit limit. Industry figures privately believe the chancellor is likely to opt for a more moderate increase, raising between £1bn and £1.5bn.
At present, general betting duty on sports such as horse racing and football is levied at 15%, while remote gaming duty is 21% and machine gaming duty for the most popular high-street slots is 20%. Casino gaming duty ranges from 15% to 50%. The Treasury has been considering harmonising these duties, but the committee joined the SMF and IPPR in rejecting that approach.
The Betting & Gaming Council (BGC) has argued that raising taxes would force firms to offer less favourable odds and drive gamblers to the unregulated market. However, the committee pointed to evidence from the SMF casting doubt on whether higher duty rates are associated with greater use of the hidden market internationally.
The BGC has also cited an EY report warning that 40,000 jobs could be lost and the economy hit by £3.1bn if taxes rise too sharply, while Betfred has threatened to close all of its 1,287 shops. A BGC spokesperson said a tax raid would end up "reducing Treasury revenues and cutting the vital funding our members provide to British sport, including horseracing, football, rugby league, darts, and snooker".
