Labour MP calls for online gambling tax reform in the UK

Alex Ballinger, a Labour MP, has publicly insisted that a further tax should be imposed on online gambling. This echoes the call from the British Horseracing Authority (BHA) earlier in the year, which suggested that higher taxes should be implemented on digital casino products.

Ballinger believes that the public recognises that gambling is “causing harm” and would therefore accept this new tax reform. 

He also claims that previous tax increases are just a “drop in the ocean”. 

The MP is very vocal on the dangers of gambling, having been exposed to the “harms caused by… addiction since his time in the army”. 

Gambling online has very quickly become the most popular sector in the industry, with 37% of the British population gambling at some point during the month. 

Gambling tax around Europe

For the past six years, the tax on gambling has been at 21%, which is relatively low when compared to other European countries. Let’s take a look: 

Country	Tax levels
France	Initial reduction of 25% and increases after that.
Poland	50%
Denmark	45%
Netherlands	34%
Czech Republic	35%

According to European Casino Association, the German city of Hamburg is being taxed 55% on its gross gaming revenue (GGR). This means that considerably more money is being paid to the German Government from gambling revenue than is to the UK Government.

Copying the German model?

Potentially, the British may be able to learn something from the Germans. 

German casinos have similar levels of revenue and popularity, but the German Government get more revenue from the tax levels. 

Germany has a very similar percentage of people who gamble as the UK, and whilst both countries earn billions of pounds from the industry, Germany gains nearly ten billion more from their tax than the British. 

Germany also shows that this tax wouldn’t deter players from the regulated gambling sites. 

Despite high taxes, 67% of under-35s in Germany gamble at some point during the year, which is, in fact, slightly higher than the British population. 

What does this mean for the gamblers?

One of the most important parts of this tax is the effects it will have on the people who gamble. 

Frequent gamblers may start to notice that they aren’t winning as much. Higher taxes mean more losses for players, as online gambling companies fight to keep their profits up.

This could encourage players to start using black market platforms.

However, the success of the German market is a positive sign. 

As players are still using licensed sites in Germany, it shows that regulated markets don’t lose players despite these higher taxes. 

It is always a fear that negatively impacting the licensed operations too much may drive the public to offshore sites, which aren’t as safe. 

Public response

The response online has been overwhelmingly positive, with one Reddit user calling to make ‘all companies pay full tax in the UK’ when they are based in the country.

Some online casinos base themselves elsewhere with little or no tax, raising the argument of whether they should be able to access Britons as customers. 

Why tax gambling?

Whilst it hasn’t yet been confirmed or even proposed, a tax increase for online gambling would impact the public less than other potential taxes, and force these companies to give possibly billions more to establishments like the health service or military. 

However, it is important to remember that different forms of gambling are taxed differently, and rightly so. The online operators usually have lower costs but higher revenue, meaning they can afford higher taxes than more local sites, like bingo halls, could. 

Pros 👍	Cons 👎
Reduces financial inequality for both the public and companies	Could potentially hurt gambling companies
Increases funds going toward public services	May increase tax avoidance
Would bring more money into the economy	Can take time to implement

Taxing gambling means less tax on the public, more money towards public services and less money for private corporations. 

Time will tell whether the Starmer government listens to Ballinger’s appeal or if it will fall on deaf ears.