Government Tax Hikes Could Close Bingo Halls

A national newspaper has recently reported that hundreds of bingo clubs are on the verge of closure thanks to recent tax hikes by the Chancellor of the Exchequer. It is thought that nearly 200 clubs are feared to be at risk of closing their doors after George Osborne introduced a slot machine duty of 20% last month (February 2013). The total impact is estimated to be £9 million per year in additional taxes. Since 2005, more than 150 halls have closed, and the managers of those which have so far managed to survive are concerned that the new taxes could have disastrous consequences for 170 other clubs, who currently make £70,000 or less per year.

It is well-known that clubs have become more and more reliant on slot machines to make up for the drop in visitor numbers they have experienced since the rise in popularity of online gaming sites, and the drastic downturn in the UK’s economy. A representative of the Bingo Association (Miles Baron) says that the amount of government taxation on bingo-related businesses is “critical to the survival of many clubs.” The Association is a trade body which represents the interests of the owners of 400 UK halls (out of a total 467).

The industry is estimated to employ more than 13,000 people, whose livelihoods would also be at risk if the tax rate continues at its current level. Industry leaders have appealed to the Chancellor before the next budget is announced, pointing out that bingo is one of the highest-taxed types of gambling. They want the rate to be dropped to 15%, which would harmonise it with bookies and online gaming sites. Mr. Baron believes this would have a “positive impact” on operators, customers, and the Exchequer. The new duty would apply to all gaming machines in arcades, sports-betting shops, and bingo halls, resulting in £9.2m of taxes being levied. However, since 2006, the bingo industry’s profits have plummeted from £250m to £125m, with 6 million players dwindling to just 3 million.

Back in January 2013, Gala rejoined the Association is the hopes of helping the campaign to tackle the current tax system.

Do you think that the 20% tax rate on bingo operators is fair, or do you agree that it should be lowered to come into line with the 15% rate paid by other gambling industries? Perhaps your local club is at risk of closure if the government refuse to listen?

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