UK raises remote gaming duty to 21%

UK Chancellor Philip Hammond has this afternoon (Monday) confirmed remote gaming duty will increase from 15% to 21% from October 2019, while stakes will also not be cut on FOBTs for another 12 months.

Hammond (pictured) had been expected to announce a rise in tax, with reports last week suggesting an increase of between 20-25%.

Delivering his Autumn Budget 2018 in the House of Commons, Hammond said the move will “fund the loss of revenue” as a result of the government cutting the maximum stakes on FOBTs.

In May, the government accepted Gambling Commission recommendations to set a new maximum stake of £2 (€2.25/$2.56) on FOBTs, a sharp cut on the current limit of £100.

Initial plans had been for the FOBT changes to come into effect from April 2019, but this will now be delayed until next October.
 
Speaking to iGamingBusiness.com about today’s announcement, Remote Gambling Association (RGA) chairman Clive Hawkswood said that with tax levels as high as 25% having been mooted last week, the 21% figure is “encouraging”

“It’s still a bit more than our analysis; the work we did with Ernst & Young pointed to a figure of a bit less than that [to cover FOBT losses],” he said. “We can debate whether it’s fair, but it’s about mid-range of expectations.

“The key thing is timing, with it being in October as we had expected April. It’s a tax hike but it gives an extra six months, so that’s the silver lining.

“Companies have to go away and decide how they will best accommodate the increase, whether that be changes to bonuses, for example.”

John White, CEO of amusement arcade trade group BACTA, which has been a long-time critic of B2 machines, has also welcomed the news, saying that the organisation its “pleased” the government has finally set a deadline.

White said: “Whilst we are hugely disappointed the government has taken this long to implement decisive action, we are none-the-less pleased a deadline is now set to correct the anomaly that high stakes FOBTs represents.

“A reduced £2 maximum stake is the only way forward in order to apply suitable player protection.”

Image: Secretary of Defense