Flutter, the owner of Paddy Power, is to cut around 1,400 jobs in the UK and Ireland as part of a major restructuring after being hit by increases to UK gambling taxes.
The gambling giant said the proposed job cuts will impact workers in Leeds and Dublin. The restructuring will also affect UK and Ireland staff based at Flutter hubs in Porto, Portugal, and Cluj-Napoca, Romania.
It is understood the move will hit around 15% of workers in the UK and Ireland, where Flutter employs around 9,000 staff.
Restructuring to Mitigate Tax Impact
Flutter said the overhaul is part of efforts to mitigate costs following a “significant increase” in UK gaming taxes from last year’s autumn budget. UK and Ireland boss Kevin Harrington said the group was not able to “fully absorb” the impact without cutting costs.
Plans announced in last year’s autumn budget saw the rate of remote gaming duty – the tax on online casino games and slots – increase from 21% to 40% earlier this year. Firms will also see a new 25% rate of general betting duty for online bets from April next year, up from 15%, as part of the budget changes.
It comes amid speculation that the Government could increase the rate of machine games duty, which is the tax on fruit machines, roulette machines and other slot machines, at the next Budget later this month.
Cost of the Restructuring
Flutter said its restructuring plan is likely to cost between 80 million and 90 million US dollars (£60 million and £67.5 million).
Mr Harrington, Flutter UK and Ireland chief executive, said: “The material increase in betting and gaming duties announced in the UK budget last year has fundamentally changed the economic model of the regulated betting and gaming industry in the UK while helping to fuel the unlicensed, unregulated market.”
He added: “As we warned a year ago, we cannot fully absorb a rise of this magnitude without reducing our fixed cost base and therefore must restructure our business so that we can best position ourselves for the future.”
“We remain confident that we are well placed to benefit from share gains given our position as the largest scale operator in the UK.”
