Gambling stocks tank on report of potential £3bn tax raid
By Michele Maatouk
Date: Monday 14 Oct 2024
(Sharecast News) - UK gambling stocks tumbled on Monday following a report the government is planning a tax raid of up to £3bn on the gambling sector in this month's Budget.
At 0840 BST, Entain shares were down 13%, Flutter Entertainment was 7.2% lower, Evoke was 13% weaker and Rank Group was down 6.7%.
According to The Guardian, Treasury officials are understood to be weighing up proposals, put forward by two influential thinktanks and backed by one of the party's top five individual donors, to double some of the taxes levied on online casinos and bookmakers.
Measures could be included in this month's budget, Labour's first in 14 years, as the chancellor tries to plug the £22bn "black hole" she claims to have founded in the finances after taking office.
The Guardian said sources familiar with the discussions said the Treasury had yet to make a decision but appeared receptive to tweaking the UK's complex regime of betting and gaming duties to raise extra funds of between £900m and £3bn, despite opposition from industry lobbyists.
A source familiar with Treasury thinking told the paper: "It's definitely on the map. There's no obvious pushback to it."
It was understood that one the tax plans that Treasury officials are looking at comes from the Institute for Public Policy Research (IPPR). A report by the thinktank estimates the government could raise £2.9bn next year - and up to £3.4bn by 2030 - by doubling taxes on "higher harm" products such as online casino games.
The UK levies seven types of betting and gaming duty, including on the national lottery, with the exact rate varying depending on the type of activity. Last year, the taxes raised £3.3bn, or about £2.2bn excluding lottery duty.
Under the IPPR's proposals, the Treasury would leave duties untouched on "lower harm" activities, such as the lottery and bingo. But the proposal would involve doubling taxes such as the 15% general betting duty, levied on high-street bookmakers' profits.
Remote gaming duty, which affects online operators, is charged at 21% but would be raised to 50% under the IPPR's plan.
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