Tax proposals 'would close 3,400 betting shops and wipe £84m from racing's income'

Racing could lose £84 million in funding and more than 3,400 betting shops could close if the most punitive tax proposals being made for gaming machines are adopted by the government, according to industry analysis.

The Betting and Gaming Council (BGC) has carried out research which claims that an increase in machine games duty (MGD) to 50 per cent from 20 per cent would put 25,000 people out of work.

The BGC said the 5,800 betting shops currently operating support 42,000 jobs in Britain and contribute £140m a year to horseracing, while the sector also pays £1 billion in direct tax to the Treasury and another £60m in business rates to local councils.

Chancellor Rachel Reeves has signalled that gambling firms "should pay their fair share" when it comes to taxes as she prepares to deliver the budget on November 26.

The Institute for Public Policy Research (IPPR) think tank has called on the government to raise MGD to 50 per cent from 20 per cent as part of a number of hikes in gambling duties it claims could raise up to £3.2bn a year for the Treasury.

According to the BGC's analysis an increase in MGD to 50 per cent would cause 3,464 betting shop closures, 25,086 job losses, and reduce horseracing’s funding from betting shops, which comes via the levy and media rights payments, by £84m.

An increase to 40 per cent would lead to 2,912 closures, 21,088 job losses, and halve contributions to racing to £70m, while even a hike to 30 per cent would cause 1,992 closures, 14,425 job losses, and a £48m loss to racing, the BGC said.

Both Betfred and Ladbrokes and Coral owner Entain have said betting shop numbers would be threatened if taxes rise in the budget, while the BHA's acting chief executive Brant Dunshea said last month they were "nervous about any risk of shop closures".

Grainne Hurst: "Tax rises would hammer punters and threaten the future of horseracing"

BGC chief executive Grainne Hurst said: "Any increase in betting and gaming taxes on any part of the industry would hammer ordinary punters while threatening British jobs, high streets and the future of horseracing.

"The figures for machine games duty speak for themselves – thousands of shop closures, tens of thousands of job losses, and an £84m hit to horseracing. This isn’t a small tweak to the tax system – it’s an act of economic vandalism against communities, workers and Britain’s second most popular spectator sport.

"These proposals risk achieving the exact opposite of what the Treasury intends – lower tax receipts, fewer jobs and more punters turning to unsafe, unregulated black market gambling."

The BGC said an increase in MGD would affect other sectors too, with nearly half of all UK pubs having at least one gaming machine, which it said earn landlords around £9,000 a year on average. Bingo halls and casinos would also be affected, while the wider high street would also feel the impact, the BGC claimed, due to loss of footfall from betting shop customers.

Hurst added: "Britain’s betting and gaming sector is one of the most highly regulated in the world, supporting jobs, investment and sport across the UK. We urge the government to resist short-term tax raids that would cause long-term damage – to jobs, to the economy, and to the future of British sport."

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