Will Betfred and the High Street Gamble Their Future on Tax Hikes?

All 1,287 Betfred shops could vanish from the UK High Street if Chancellor Rachel Reeves increases taxes on gambling companies, warns Fred Done, co-founder and chairman of Betfred. He highlighted that such closures would jeopardize 7,500 jobs. Done has labeled tax hikes as the ”biggest threat” to the gambling industry in over 57 years, underscoring the financial strain such measures could bring. Reeves, encouraged by former Prime Minister Gordon Brown, has suggested higher taxes could help combat child poverty, with estimates suggesting up to £3.2 billion could be raised from potential taxes as high as 50%.

The Betting and Gaming Council criticized these proposals, claiming it could drive gamblers to the black market. William Hill, another major betting company, warned that it could close around 200 shops if taxes rise. Fred Done mentioned that even minimal tax increases would force him to shut down locations, stating that ”there is no profit in the business” with taxes above 35%. He also noted that 300 shops are already losing money, and higher taxes could increase this number significantly.

Currently, the gambling industry in the UK is not taxed on punters’ winnings or VAT but pays various duties, including 21% on online casino gaming and 15% on general betting duties. Done pointed out that recent hikes in National Insurance Contributions and the minimum wage have added £20 million to operating costs, making profitability increasingly challenging. Rivals like Paddy Power are also responding to market pressures by closing multiple shops.

Despite these challenges, Done believes existing High Street betting shops can offer better safeguards for gamblers compared to offshore competitors. Advocacy groups emphasize the need for higher taxes and regulations to mitigate the social and financial harms caused by gambling, especially to protect at-risk individuals.

In conclusion, as Done reflects on the future of the betting landscape, he acknowledges the increasing trend toward online betting but insists that without drastic tax changes, the High Street betting industry could still thrive for another 20 years. However, he remains skeptical that his appeal to maintain current tax levels will sway the Chancellor, noting, ”we’re 10 to one against”.