Gambling Stocks Plummet as Reports Suggest £3bn Tax Hike

UK gambling stocks took a significant hit following reports that the Labour Government is considering a £3bn tax hike on the gambling sector. With the industry under increasing scrutiny, shares in major operators like Entain, Flutter, and Rank Group have plummeted as investors brace for the potential financial impact. Read on to discover how this proposal could reshape the UK’s gambling market.

UK Gambling Stocks Slide as Reports Suggest £3bn Tax Hike Proposal by Labour Government

Gambling stocks across the UK have tumbled following reports that the Labour Government is considering a substantial tax increase on the sector. According to a report by The Guardian, Ministers are evaluating proposals that could see the industry face a tax hike of up to £3bn ($3.92bn) as part of a broader effort to address the UK’s budget deficit.

The potential tax measures, which have reportedly been proposed by two influential thinktanks, have caused concern within the industry. A key supporter of the proposed tax hike is Derek Webb, a former poker player and casino game inventor, who is also a donor to the Labour Party. Webb and others backing the proposal believe the gambling sector could provide much-needed funds to address the £22bn fiscal “black hole” that UK Chancellor Rachel Reeves has identified in the country’s finances.

Key Points:

Potential £3bn Tax Raid on Gambling Sector: Ministers are considering raising up to £3bn from the gambling industry to help plug the UK’s budget deficit.
Stock Prices React: Shares in major UK gambling operators have fallen sharply, with Entain, Flutter, and Rank Group all seeing significant declines.
Proposals from Thinktanks: The Institute for Public Policy Research (IPPR) and the Social Market Foundation have proposed measures that could see taxes on high-risk gambling products and online operators double.

The Tax Proposal and Its Impact

The proposals put forward by the Institute for Public Policy Research (IPPR) suggest that doubling taxes on “higher harm products” such as online casino games could raise as much as £2.9bn, potentially increasing to £3.4bn by 2030. Similarly, the Social Market Foundation has proposed raising the tax rate on online gambling companies from 21% to 42%, which they estimate could generate around £900m.

The reaction from the financial markets has been swift and severe. Shares in Evoke dropped by 11% this morning, with a new share price of £0.57. Similarly, Entain saw a 10% decline, bringing its shares down to £6.86, while The Rank Group fell 7% to £0.80. Even Flutter Entertainment, a major player in the global gambling market, saw its shares drop by 5% to £176.45.

The industry’s response has been one of growing concern. If these proposals are implemented, the UK gambling sector could face a significant financial burden, potentially leading to a reshaping of the market landscape as operators adjust to the higher tax environment.

Industry Concerns and Reactions

The potential tax hike has raised alarms within the gambling industry, particularly as it comes amid broader regulatory challenges facing the sector. Gambling Insider has reached out to the Betting and Gaming Council (BGC) for comment on the issue, though no official statement has been made yet.

The proposals are seen by some as part of a broader push by the Labour Government to tighten regulations on the gambling industry, a move that could have wide-reaching implications. Critics argue that increased taxes could stifle innovation and reduce investment in the sector, while supporters see it as a necessary measure to curb the social harm caused by problem gambling.

In a broader context, the news from the UK coincides with ongoing discussions in other markets regarding gambling regulation. In the Netherlands, for example, concerns have been raised about the amount of money being spent on illegal gambling. The Dutch Online Gambling Providers (VNLOK) and the Dutch Online Gambling Association (NOGA) are actively discussing measures to address this issue.

The reported potential £3bn tax hike on the UK gambling sector has already led to a significant drop in stock prices for major operators like Entain, Flutter, and Rank Group. With the Labour Government set to deliver its first budget on 30 October, the industry is watching closely to see how these proposals will be addressed. Whether or not the tax hike materializes, it’s clear that the UK’s gambling industry is facing a period of increased scrutiny and potential upheaval.

The post Gambling Stocks Plummet as Reports Suggest £3bn Tax Hike appeared first on Gamingo News.

UK gambling stocks took a significant hit following reports that the Labour Government is considering a £3bn tax hike on the gambling sector. With the industry under increasing scrutiny, shares in major operators like Entain, Flutter, and Rank Group have plummeted as investors brace for the potential financial impact. Read on to discover how this
The post Gambling Stocks Plummet as Reports Suggest £3bn Tax Hike appeared first on Gamingo News.