Britain’s coastal arcade industry faces potential closure if gaming taxes are increased, industry leaders have cautioned. They argue that a proposed hike from 20% to 50% in slot machine duty could devastate seaside towns and lead to the shutdown of around 400 venues, impacting not only seaside arcades but also high street gaming centers, pubs, and working men’s clubs with fruit machines.
The pushback against tax hikes comes as the gambling sector intensifies its efforts to resist upcoming budget changes. Former Labour Prime Minister Gordon Brown has supported recommendations to target the supposedly undertaxed gambling industry, aiming to raise £3.2 billion to combat child poverty. Concerns have been raised that measures to address gambling addiction might inadvertently harm other traditional forms of betting that have long been enjoyed.
Joseph Cullis, president of Bacta, representing seaside arcades and adult gaming centers, emphasized the vital role played by slot machines in sustaining these businesses, particularly during off-peak seasons. He warned that a drastic increase in machine games duty could lead to the collapse of the industry, impacting local jobs and tourism in seaside towns.
The Institute for Public Policy Research has proposed raising various gambling levies to generate additional revenue. While remote gaming duty currently contributes significantly to the Treasury, the suggestion to more than double it from 21% to 50% aims to collect an extra £800 million. Similarly, raising the machine games duty from 20% to 50% could boost annual tax revenue to £900 million. The wider implications of these proposals have raised concerns within the gambling industry about potential financial impacts on prize money and sponsorship.
The gambling industry, which largely relies on bookies and gambling firms for sponsorship and prize money, fears the consequences of increased taxation on their profits. The debate centers on finding a balance between addressing gambling-related harms and avoiding unintended consequences for the industry as a whole.
Industry insiders caution against disproportionately targeting addictive forms of gambling, such as online casinos, as it may have unintended repercussions on other sectors. Suggestions have been made to reconsider specific duties on bingo and horse racing to mitigate potential adverse effects on the industry. Critics argue that the risk of a black market surge is exaggerated, pointing out that licensed operators must adhere to regulations in the UK.