By Lauren Smith
Updated: 24 November 2023
Under new proposals from the British government, online betting companies would be required to pay 1% of their gross gambling yields to fund research, prevention, and treatment of gambling addiction.
Table of contents:
Levy could raise £100 million annually
The proposals call for gambling websites to pay a 1% levy on their gross gambling yields and physical betting shops and casinos to pay 0.4%.[1] The government said that was a “fair and proportionate approach” that takes into account the operating costs and the levels of harm associated with different gambling activities.[2]
The levy would be applied to gross gambling yields (GGY), the money retained by the gambling operator after winnings have been paid out but before operating costs have been deducted. [3]
The department estimates that a levy could raise £100 million per year. [2] The UK’s gambling industry is worth around £14 billion annually. [4]
GambleAware, a charity that provides education on gambling harms, prevention, and treatment, has previously estimated that a 1% levy could raise £140 million annually. [5]
“Harmful gambling can affect people’s savings, ruin relationships, and devastate people’s lives and health,” Health Minister Neil O’Brien said. [2]
According to figures from the National Health Service (NHS), 2.8% of adults in England are problem or at-risk gamblers. [6]
Some companies were paying just pennies through the voluntary levy
A voluntary levy on gambling operators already exists in the UK, asking them to donate 0.1% of their net revenue to charities undertaking research, prevention, and treatment of gambling addiction. Most donate to GambleAware. [7]
However, some gambling operators pay as little as £1 ($1.22) each year toward the levy, the UK’s Department for Culture, Media and Sport (DCMS) revealed. [2]
That includes some companies that made multi-million-pound deals to emblazon the kits of Britain’s most popular football teams with their logos, a 2021 investigation found. Philippines-based W88, which sponsored the shirts of Crystal Palace F.C. until 2022, paid just £250 ($303) toward addressing gambling harms in during the 2020-21 financial year. [8]
In 2019, the UK’s largest betting companies promised they would increase the amount they paid under the voluntary levy from 0.1% of their annual UK revenue to 1% over five years. Their contributions did rise, to £41 million during the 2022-23 financial year. [9] However, critics argued that they still aren't giving enough.
“Gambling firms should always pay their fair share and this new statutory levy will ensure that they are legally required to do just that,” Gambling Minister Stuart Andrew said. [2]
Funds would support treatment of gambling addiction
Under the proposals, the money will be collected by the UK’s Gambling Commission, the regulator for the sector. [10] The regulator will then distribute the funds to the state-run NHS and UK Research and Innovation (UKRI), which coordinates scientific research.
The funds will “help to develop a truly national approach to prevention and fund independent, high-quality research to inform policy and practice,” the government said in a statement. [2]
Currently, gambling operators pay the voluntary levy to a network of charities. The mandatory levy would ensure the industry no longer has a say over how the money is spent, the government said.
Those charities currently provide much of the treatment for gambling addiction in the UK. The Betting and Gaming Council (BGC), which represents gambling operators, claims as many as 85% of problem gamblers receiving treatment do so through charities. [11]
However, the NHS is working to treat more patients and this year will open seven new specialist gambling addiction clinics around the country. It already operates seven dedicated clinics for problem gambling, including one for children and adolescents.
NHS mental health director Claire Murdoch said: “Gambling addiction destroys people’s lives and with record numbers turning to the NHS for support, the health service has met this demand head on by opening four new specialist clinics in recent months, with a further three opening later this year.” [2]
“The NHS has long called for a statutory levy because it is only right that this billion-pound industry steps up to support people suffering from gambling addiction,” she said.
Technology has made gambling more addictive
Funds will also be channeled into prevention, to stop people from developing gambling problems in an era of constantly accessible mobile games.
The NHS’s Digital Health Survey found that these online gambling products are more risky than conventional betting. For example, those who play online slots and casino games are eight times as likely to be problem gamblers than the general population. [2]
The government has already unveiled plans to improve protections for gamblers, including requiring financial risk checks so gambling operators can identify players at risk of harm, stake limits for online slots, and stricter controls on the marketing of bonuses. [2]
The gambling industry responds
The Betting and Gaming Council (BGC) welcomed the proposals for the levy but said it should be applied on a sliding scale.
“The BGC supports a new mandatory levy—indeed we proposed this to the Government ahead of the White Paper. Our industry has been the majority funder of RET [research, education, and treatment] for over 20 years,” the body said in a statement.
“It must also be applied on a sliding scale, with smaller percentage contributions from land-based operators, including independent betting shops on our high streets that have struggled to recover after the pandemic and incur disproportionately higher fixed costs.”
It also called for the continued funding of gambling support charities. [11]
