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How the UK budget shapes the UK bingo market

16.12.2009

There has been a considerable amount of publicity in the run up to UK budget regarding the double taxation that Bingo halls must pay.

All business are required to pay corporation tax plus a VAT of 15%, however, unlike other businesses there is an additional tax payable by Bingo halls which means they are required to pay 15% on all proceeds, or revenues. This additional tax is called Gross Profits Tax (GPT) and means, while most industries pay 15% tax sales in the form of VAT, Bingo businesses need to pay a total of 30%.

In his most recent budget, chancellor of the exchequer; Alistair Darling, removed this double taxation by discarding VAT. Overall this will save gambling companies in the region of £50m a year.

However, as if frequently the case – what the UK government offers with one hand can often be taken with the other hand.

To counterbalance taking Bingo out of VAT the government has increased the GPT from 15% to 23%. In the bigger picture this offsets the taxation benefits by 50% making them significantly less valuable although better than they were before, and again, the UK government has now forced additional tax measures that will out weigh the small gain achieved by stripping the VAT.

Pre-budget, there existed a AMLD (Amusement machine Licence Duty) that was required to be paid on slot machines – around a flat payment of £2,000 per slot machine. The government has now changed this and the method by which this taxation is enforced representing a 9% increase.

In what are surely felt to be ‘tough times’, numerous bingo halls up and down the country are fighting to keep afloat and these new measures are regarded by many to as unjust actions.
  
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