UK Government Increases Remote Gaming Duty from 15% to 21%

Staff Writer Industry News 3,594

Starting in October 2019, UK gambling operators will have to pay increased casino taxes. What this might do for newcomers to the market, is to make them have to struggle more to keep their businesses alive.

Reasons for Upgrading

Philip Hammond, the UK Chancellor, had done a research on the matter and came to a conclusion that based on the outline on the online gambling taxes for autumn 2018 that had been presented, they needed to be raised.

Hammond said it was due to the generated revenue’s failure to meet the government’s expectations. We got wind of online gambling operators that feature live games such as video poker will have it the worst. According to Hammond’s statement, they are the ones exceeding all others’ revenues.

Another reason for the unexpected change is the tax spike. The abovementioned announcement read that the Remote Gaming Duty (RGD) needed to be raised as a result of the recent FOBT (Fixed Odds Betting Terminals) stake cut.

What does that have to do with the government’s decision?, you might wonder. The FOBT shift has been a hot topic in the British parliament in the past few months. The comments coming from the top have been ambiguous, which hinted at the fact that the decision regarding RGD was predetermined long before it was made public. As things stand now, the final date for FOBT will not be in 2020, as it had been stated, but October 2019.

Unexpected Reactions

Certain operators were happy to hear the news as it had been said that the raise would total 25%. However, since this is the 6th time that the tax has been altered in the past 4 years, operators fear that the business might become unsustainable.

Namely, they dread that they might have close down or get sold to bigger companies. As for the UK government, they expect an approximate loss of £1.15b from the stake cut, but hope to alleviate the damage with £1.2b, which is how much the tax revenue is estimated to bring.


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