The Betting and Gaming Council (BGC) has labelled the Institute for Public Policy Research’s (IPPR) trio of tax hike proposals “economically reckless”.
The think tank released its proposals on 6 April and argued that raising gambling taxes would lift half a million children out of poverty.
Proposed tax changes included increasing remote gaming duty for online casinos from 21% to 50%, as well as raising machine games duty from 20% to 50%.
The body also suggested an increase in general betting duty on non-racing bets from 15% to 25% to bring the rate in line with that paid on horseracing bets.
That suggestion includes counting the 10% Horserace Betting Levy in addition to the 15% rate already paid on horseracing bets.
The IPPR’s plan, which has since been backed by former Prime Minister Gordon Brown, claims that the proposed hikes would generate £3.2bn.
Brown, who was prime minister from 2007 to 2010, said that while increasing gambling taxes wasn’t the only solution available to the government, it was the “straightforward budget choice”.
Brown was also Chancellor of the Exchequer from May 1997 to June 2007, during which time the 2005 Gambling Act was passed and enacted in 2007.
However, the BGC has hit back, arguing this “drastic tax hike” would hurt the average gambler and lead to an increase in black-market activity.
The BGC’s statement read: “We completely reject the proposals by the IPPR, which Gordon Brown has based his calls for a drastic tax hike on, and which will only hit ordinary punters.
“These proposals are economically reckless, factually misleading and risk driving huge numbers to the growing, unsafe, unregulated gambling market, which doesn’t protect consumers and contributes zero tax.
“BGC members contribute £6.6bn to the economy, generate £4bn in tax, while supporting 190,000 jobs.
“It is also incorrect to suggest horseracing is taxed at a higher rate. General betting duty is 15% across all sports.
“Conflating the separate levy with tax is misdealing, as the levy goes directly back into racing to support the sport.
“Further tax rises, fresh off the back of government reforms which cost the sector over £1bn in lost revenue, would do more harm than good – for punters, jobs, growth and public finances.”
The Green Party added its voice to the matter, backing the IPPR and Brown’s call to increase gambling taxes.
Former Green Party leader Natalie Bennet commented: “Having been at the heart of the New Labour government, which unleashed the toxic, destructive gambling industry that we have today with the 2005 Gambling Act, it is good to see Gordon Brown now calling for fair taxation of the massive cash cow.
“And excellent that he is calling for that to money to be used to end the two-child benefit cap, a policy deliberately causing child poverty that is astonishingly still in place a year into this Labour government.”
Calls to raise the UK’s remote gaming duty are not new, with the Social Market Foundation suggesting an increase to 50% last month.
However, in July, the BGC released the findings from a study it commissioned and was carried out by YouGov, which said that two-thirds of bettors in the UK would turn to the black market if taxes were increased.
Last October, the UK government avoided raising both remote gaming and betting duty in its Autumn Budget.
The post BGC: Think tank’s proposed UK tax hikes are “economically reckless” first appeared on EGR Intel.
The Institute for Public Policy Research’s has suggested raising remote gaming duty to 50% would help raise £3.2bn and reduce UK child poverty
The post BGC: Think tank’s proposed UK tax hikes are “economically reckless” first appeared on EGR Intel.