UK Betting Statutory Levy Rates Higher than Initial Proposal Estimates

Earlier this week, the UK confirmed its plans to implement a statutory levy applicable to betting and gaming companies. The betting levy, affecting all licensed operators would be charged based on the respective company’s gross gambling yield (GGY) from the previous year with the levy rates ranging from 0.1% to 1.1%.

Now, Nick Arron, lead partner of the Poppleston Allen betting and gaming team, shared his opinion on the topic, acknowledging changes between the initially announced and implemented levy rates.

Proposed Levy Rates, Higher than Original Proposal from October 2023

The lowest statutory levy of 0.1% on GGY would apply to all machine technical licenses, pool betting providers and family entertainment centers. On the other hand, land-based bingo parlors, adult gaming centers and on-course bookmakers would be subjected to a 0.2% statutory levy. Land-based casinos and betting venues would be subject to a 0.5% levy on their GGY, while a 1.1% levy rate would apply to all online gambling operators and all software licenses.

Poppleston Allen’s expert argued that the recently announced levy rates were higher than the initially proposed rates. For example, Arron said that online gambling operators and software licenses would be subjected to a 1.1% statutory levy, a figure that represents a 0.1% increase when compared to the initially proposed 1% rate.

Similar increase from the proposed statutory betting levy was observed for land-based betting venues and casinos, considering the initially proposed 0.4% levy rate, the expert reminded. Concerningly, Arron said that the announced 0.2% levy rate for arcades and bingo was double considering the initial proposal of 0.1%.

The aforementioned proposed levy rates were tabled by the country’s former government back in October 2023. While the rates for some operators and providers marked an increase, the ones for others decreased.

For example, Arron pointed to the initially proposed levy rate of 0.4% for all machine technical licenses which was decreased to 0.1% in the latest government announcement. The initially proposed levy rate for pool betting previously was 1%, while the most recent announcement slashed the rate to a mere 0.1%.

The Levy Will Help Generate Funds for Prevention, Treatment and Research of Gambling Harm

The proposed statutory levy, if approved, is expected to help gambling treatment, prevention and research. The logic behind the varying rates is related to the costs of doing business. In that line of thought, iGaming businesses which are usually associated with lower costs would be subject to higher rates.

Besides research, treatment and prevention, the levy is expected to help the NHS, allocating additional funds for harm prevention. An estimated £100 million ($125.9 million) is expected to be generated annually from the new levy. Still, in order to be enforced, the new levy needs to receive approval from Parliament. If that happens, without delay, the levy can be enforced starting from April next year.