UK bookie opens market on betting tax rise as industry nears potential breaking point

A UK and Ireland bookmaker has opened up a market on its platform on what the rate of Machine Games Duty (MGD) will be after next week’s Autumn Budget. AK Bets, which is prominent in the UK and Ireland horse racing scene, revealed this on its X page on Sunday night, initially pricing the rate to be raised to 40% at 1/2. This has since been pushed out to 8/13 at the time of writing, with the rate to stay at 20% priced at 2/1 – the same price that the bookmaker has on an increase to between 21-39%. Founder Anthony Kaminskas told SBC News that despite the market’s “generally playful” nature, “the rate set will have a monumental effect on the viability of betting shops and maybe even horse racing itself”. “Given we talk so much about it and we haven’t a clue what this government will do, we decided to offer a market on it,” Kaminskas explained. “In keeping with the gambling market Labour are creating, we’re taking loads of margin, a sign of things to come in the regulated gambling space as firms try to absorb these crushing tax rises. “Exactly 40% is the biggest loser in the book at present but the price changes likely reflect the public comments of respected industry professionals over the weight of cash. We anticipate further interest as Budget Day approaches.” Is the UK betting industry at breaking point? MGD on Category B gaming machines is heavily touted to double from 20% to 40% in next week’s Budget. Talk on the matter has been ramped up in the UK in recent days following a signed letter from 90 Labour Party backbench MPs who are pushing for this increase, while excluding a hike on traditional fruit machines in pubs. The gambling industry bit back after this letter was revealed to the public on Friday by the author, Labour MP for Halesowen, Alex Ballinger. Betting and Gaming Council (BGC) Chief Executive Officer, Grainne Hurst, said that MPs are “deeply misguided” in thinking that raising taxes on the gambling industry will protect UK communities and high streets. The debate has rolled onto mainstream media, with Ballinger appearing on ITV News claiming that the lobbying comes from “MPs recognising the harm that we’re seeing in our communities”. Many other observers see it differently. Retail betting, and the wider regulated industry in the UK in general, has its faults. However, the way that an increase in MGD has been painted as somewhat of a vital player protection measure is simply untrue. The rise would only lead to shop closures. Of course, this would mean that a portion of customers will simply stop going to betting shops. Some shops would remain, meaning that, in a less-damaging scenario, players who are dead set on playing machine games in betting shops would migrate to those that are still open. This at least means that they would still be playing in the regulated market. However, it would also inevitably see players transfer to playing slots on black market platforms, where they are undoubtedly less protected from the harms which MPs are suggesting would decrease in the event that MGD increases. Kaminskas is one of those in agreement that MGD rising would only be beneficial for illegal operators. “The only winners to increased taxation are the black market,” he continued. “I don’t have enough fingers on both hands to count the losers.” So while some may see AK Bets’ MGD market as a playful one, others may imply that the UK gambling industry is an 8/13 shot away from an irreparably damaging tax rise. Said damaging tax rise would arrive just one year on from another two being announced, which have already contributed to around 2,000 job losses.