Tax hike on slot machines slammed

Wouldn't you think that someone might figure out that the COST of Gambling exceeds the revenue?


Tax hike on slot machines slammed
(UKPA) – 1 day ago
A tax hike on fruit and slot machines is a "definite blow" to the gambling industry, analysts warned, amid fears the move will risk thousands of job losses at bookmakers.

The Government will introduce a new 20% Machine Games Duty (MGD) to replace the existing Amusement Machine Licence Duty and VAT, which equated to 17%, from February next year.

The increase will put 11,000 jobs at risk at about 2,600 betting shops across the UK, according to the Association of British Bookmakers, while other industry figureheads warned "the end for many amusement arcades is nigh".

Simon Davies, analyst at brokers Collins Stewart, said the MGD would hit William Hill profits by around £11 million in the first year while Ladbrokes can expect a £14 million impact.

Mr Davies added: "The Budget has demonstrated the vulnerability of so-called 'sin' industries at a time when governments are under pressure to grow tax revenues."

The Chancellor also announced plans for a UK online gaming tax.

William Hill and Ladbrokes, which have moved their online operations to Gibraltar, will have to pay a 15% tax based on the location of the player rather than the location of their business.

Mr Davies said the online gaming tax was a "bigger concern" but the pain would not be felt until 2015.

The Association of British Bookmakers said the MGD was "unsustainable" at a time when bookmakers already pay more than £1 billion in tax each year. It said: "The Government made clear the premium it places on economic growth. This measure does not protect jobs or provide the sector with incentives for growth."