BISL slams Budget’s machine tax plans

25/03/2011

Business in Sport and Leisure (BISL) notes with real concern the announcement in the budget of the Government’s intention to reform Gambling machine taxation and calls on them to scrap this proposal.

Dominic Harrison (pictured) CEO of BISL, commented: ‘Gambling like all industries needs certainty if it is to create the growth the economy needs. What the leisure and gambling industries don’t need if we are going to play our part is a completely new tax regime that creates a year of uncertainty on rates. BISL calls on the Government to scrap this plan and work with the industry on solving whatever issues they think they have with the current system’

The proposed introduction of machine gaming duty (MGD) to replace the amusement machine licence duty and VAT regime that has been in place for decades has been consistently opposed by the gambling industry. Whilst the Treasury states they will be seeking fiscal neutrality they openly admit it will result in a redistribution of the tax paid and therefore winners and losers. Such a situation can only put at risk any number of businesses who end up as losers and with the proposals including bringing non-gambling machines into the regime the UK seaside economies may be among the worst hit. Also caught up in this uncertainty will be the pub industry that is already experiencing a closure rate of 25 outlets per week.

The gambling industry has suffered a series of blows in recent years from the impact of the smoking ban, the Gambling Act 2005 and the recession plus a number of tax raids by the previous Government. This has led to a significant number of retail business closures, with the bingo and Adult gaming centre sectors particularly badly hit. Also severely affected have been machine manufacturers who have seen machine production decimated by nearly 90% in seven years.

This latest change will just put more businesses and more jobs at risk at a time when the economy can so ill afford it. This risk will extend into the wider leisure sector, including pubs, which rely on gaming machine revenue. These businesses now face a period of consultation and a long wait until the 2012 budget to learn the rate or rates. How can any industry plan for its future with such uncertainty?

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