The chief executive of Entain, the owner of Ladbrokes and Coral, has warned that higher gambling taxes in next month’s budget could force the company to close betting shops and shift investment out of the UK.
Stella David, who became permanent CEO in April, said a tax increase would compel Entain “to consider its investment level in the UK” and review possible “shop closures” across its 2,300 high street outlets. The group employs more than 14,000 people in Britain.
“At the end of the day we want to make a profitable global business,” David said. “There are other markets we have to pivot to as being more worthy of investment. There will be consequences. Having a dislocating increase in tax will have a dislocating impact on the industry.”
She warned that “every point of [tax] increase would actually have an impact that certain shops would become unviable … there is no level that does not have some consequence, the scale depends on how far it goes.”
The comments come as Chancellor Rachel Reeves faces growing pressure to raise gambling levies in November’s budget. Former prime minister Gordon Brown and other MPs have backed plans to raise the remote gambling duty from 21% to 50%, increase slot and gaming machine duties from 20% to 50%, and lift the general betting duty from 15% to 25%. The Institute for Public Policy Research estimates the changes could raise £3.2 billion ($4.29 billion).
Reeves said last week she believed “there’s a case for gambling firms paying more,” adding that while the sector contributes to the economy, companies “should pay their fair share of taxes.”
David said Entain already does. “Everyone should pay their fair share — and we already do,” she said, noting that the company paid £513 million ($687 million) in taxes last year and ranks among the UK’s top 20 taxpayers.
The Betting and Gaming Council said the wider sector contributes £4 billion in taxes annually, along with £350 million to horse racing, £40 million to football, and more than £12.5 million to sports such as snooker, darts and rugby league.
David said Entain could consider moving its primary listing to the United States if UK taxes rise steeply, following Flutter, the owner of Paddy Power and Betfair. “I’m not saying we are planning to do it right now but of course we would consider it if the situation meant that it was in the best interest of the company,” she said.
She also warned that higher taxes could benefit unlicensed operators. “The biggest winner by far from higher gambling taxes would be the black market,” she said. “A normal person on the street who likes to have a bet can’t tell the difference between a black market site and a regulated site.”
David pointed to the Netherlands, where gambling tax revenues fell after an increase earlier this year. “Black market operators are there to take as much cash out of the UK as possible, with as little friction as possible. They can look very slick and very professional. The problem is none of the profits they make come back in tax to the UK government,” she said.
Anna Hargrave, chief executive of GambleAware, said the charity welcomed the debate. “It’s for the government to decide on any potential gambling tax, but we welcome the focus this debate is bringing to the issue as gambling harm is a serious public health issue which can affect anyone and millions are affected by it each year,” she said.