URGENT UPDATE: Betfred, one of the UK’s major bookmakers, has issued a stark warning about the potential closure of up to 1,300 betting shops if a proposed gambling tax increase is enacted. This alarming development threatens the jobs of over 7,000 employees, raising concerns across the industry.
Chairman and co-founder Fred Done has called this situation the “biggest threat” the gambling sector has ever faced. Competitors echo his concerns, signaling a widespread industry crisis. The proposed tax hike was initially suggested by former Prime Minister Gordon Brown to Chancellor Rachel Reeves as a measure to combat child poverty, but it has drawn fierce backlash from the Betting and Gaming Council, which warns that it could push gamblers into the black market.
Done revealed that many of Betfred’s shops are already operating at a loss. An increase in tax would exacerbate these financial struggles. Betfred’s recent annual report indicated a profit of £1 billion, yet half of that amount was consumed by operational costs.
The stakes are high, as the Institute for Public Policy Research (IPPR) estimates that a 50% tax increase could generate approximately £3.2 billion for public finances. However, the repercussions could be catastrophic for the gambling industry. Competitor Paddy Power recently announced plans to close over 50 shops across the UK and Ireland, putting around 250 jobs at risk. Similarly, Entain has hinted at potential shop closures should the new tax be implemented.
Looking ahead, Chancellor Reeves faces immense pressure to balance public finances, with a need for an additional £50 billion. Observers are eager to see the impact of the upcoming Autumn Budget on this critical issue. As Professor Ashwin Kumar, director of Research and Policy at the IPPR, stated, “Most of the profits made by gambling companies come from a very small number of gamblers, many of whom are at risk of serious harm. Higher duties are necessary, similar to those imposed on tobacco and alcohol.”
Charity GambleAware has also weighed in, advocating for “further regulation” to protect vulnerable individuals, particularly children, from the harmful effects of gambling.
As this situation develops, the future of Betfred and the broader gambling industry remains uncertain. The implications for thousands of employees and the public are profound, making this a vital issue for stakeholders and the community alike. Stay tuned for further updates as the story unfolds.
