Source: thisismoney.co.uk
A new 50% tax on the profits of larger casinos will reverse years of favourable treatment for the gambling trade.
Industry analysts are now predicting a huge slump in investment in new and existing sites and said Britain’s first super-casino in Manchester could end up looking ‘more like a big shed full of gaming machines’ than a Las Vegas-style palace.
Casino operators reacted with dismay, claiming the Chancellor’s crackdown will undermine the economic regeneration which other ministers have used to justify a huge expansion in casinos.
Mr Brown, who was raised as a Presbyterian – a church which fiercely opposed gambling – also announced a 15% tax level for on-line gambling operators. Betting and poker website bosses have already indicated they will never relocate to Britain if faced with such taxes, since foreign countries allow them to operate with low or zero duty levels.
Since Mr Brown’s tax grab looks set to keep all operators away, it has made a nonsense of the Government’s efforts to introduce tougher rules to regulate the fast-expanding online gaming sector. Tessa Jowell had hoped to make Britain the capital of internet gaming, attracting websites to base themselves here. That ambition now appears to be holed below the waterline.
The industry had expected the Chancellor to offer a generous tax level to lure operators back to the UK but he has taken the opposite approach, effectively banishing website operators.
Currently UK casino ‘yields’ – their takings minus the winnings they pay out – are taxed in bands ranging from 2.5per cent for the first £500,000 up to 40% over £ 5million. The Chancellor has axed the lower bands completely and casinos will now pay taxes starting at 15% rising to 50% on any yeld over £10million.
The Treasury predicts the changes will bring in almost £100million extra in taxes over three years, with the new top rate ensuring ‘that this vibrant sector continues to make a fair contribution to tax receipts.’
Gaming analyst Warwick Bartlett said: ‘The 50% band seems to indicate the Government is altering its stance on gambling. It won’t bring in a huge amount of tax but it effectively puts a cap on capital investment in casinos.’
From Casino-Bingo.co.uk – 1 Casino Guide – The Complete Gambling Guide in Britain /