Betfred Warns of Shop Closures, 7,000 Jobs at Risk Amid Tax Hike
UPDATE: Betfred, a leading UK bookmaker, has issued a dire warning about the potential closure of approximately 1,300 betting shops if a proposed gambling tax increase is implemented. This move could jeopardize the jobs of over 7,000 employees, making it one of the most significant threats to the industry to date.
Betfred’s Chairman and co-founder, Fred Done, emphasized the urgency of the situation, labeling the tax hike as the “biggest threat” facing the gambling sector. Competitors have echoed his concerns, signaling widespread apprehension across the industry.
The proposed tax increase was initially suggested to Chancellor Rachel Reeves by former Prime Minister Gordon Brown as part of a strategy to combat child poverty. However, the Betting and Gaming Council has condemned the plan as “economically reckless,” warning that it could drive gamblers into the black market.
Done highlighted that many of Betfred’s shops are already struggling financially, stating, “A tax increase would exacerbate our losses.” Despite reporting a profit of £1 billion in their latest annual report, half of that amount is allocated to cover operational costs, raising concerns about the sustainability of their business model.
The potential ramifications extend beyond Betfred. Estimates from the Institute for Public Policy Research (IPPR) suggest that a nearly 50% increase in gambling tax could yield up to £3.2 billion for public finances. However, industry leaders, including Evoke, owner of William Hill, have warned that such changes could lead to the closure of up to 200 shops. Similarly, rival firm Paddy Power has announced plans to shutter over 50 locations across the UK and Ireland, putting around 250 jobs at risk.
In a recent statement, Done shared his vision for the future of gambling, predicting a shift towards online platforms: “Slowly it will go online, but we’re talking, without tax increases, we’ve still got probably 20 years of life on the High Street.”
As pressure mounts for the Chancellor to address a projected £50 billion shortfall in public finances, the upcoming Autumn Budget is poised to be a pivotal moment for the gambling industry. Professor Ashwin Kumar, director of Research and Policy at the IPPR, argues for higher taxes on gambling, likening the need for regulation to that of tobacco and alcohol. “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,” he stated.
Charity groups like GambleAware are advocating for further regulations to protect vulnerable individuals, especially children, from the potential harms of gambling.
The situation is developing rapidly, and industry stakeholders are watching closely as the government prepares to roll out its proposals. The implications of these decisions could reshape the landscape of gambling in the UK, impacting thousands of workers and the future of betting shops nationwide. Stay tuned for more updates as this story unfolds.
