UK Plans 1% Levy on Gambling Companies to Fund Gambling Addiction Treatment

October 30th, 2023: Problem gambling and addressing players’ addiction are priority concerns for the national government. As such, you can now see several initiatives and proposals for approval that aim to raise awareness of Responsible Gambling and help those struggling with gambling addiction. One of the latest moves of the UK government is its proposal to charge a 1% compulsory levy on online gambling operators and 0.4% for traditional casinos and betting companies.

According to estimates, the target gambling companies are expected to pay about £100 annually to the National Health Service (NHS). The recent announcement was part of its plan to raise funding for research and treatment of gambling addiction as a way to address the increasing number of problem gamblers in the country.

In recent years, the UK government and the Gambling Commission have intensified their partnership with charities and organizations, reflecting the UK government’s strong commitment and efforts to overhaul UK gambling laws. In addition, included in the government plans are potential online stake limits that range from £2 to £15. With the levy proposal, the UK government plans to replace the longstanding system of voluntary contributions and establish a mandatory share. 

New statutory levy to address gambling addiction issues

The UK gambling industry is facing challenges posed by digital betting, leading to gambling addiction and a shortage of research funding. And one of the solutions is to charge a 1% levy and force gambling companies to share in raising awareness and helping those with issues.

The existing voluntary levy in the UK has faced several criticisms as most operators are contributing as little as £1 in support for research, prevention, and treatment of addiction among players. In a statement by the UK Department for Culture, Media, and Sport (DCMS), casino operators will pay a new levy on top of the existing voluntary levy.

DCMS added, “The Government is minded to set the levy as a new 1% fee on gross gambling yield for online gambling operators, while traditional betting shops and casinos will pay a proposed fee of around 0.4%.” Funds raised from the new levy aim to achieve a new investment for the National Health Service (NHS) in England, Wales, and Scotland. The funds raised from the levy will be of great help to specialist addiction clinics in the UK. There are seven new NHS centers to open by the end of the year. 

UK is home to some of the largest betting companies, including Entain (ENT.L) and Flutter (FLTRF.L). The mandatory levy requires online casinos and bookmakers to pay 1% of their revenue from punters. Meanwhile, land-based casinos and betting sites have higher fixed costs like rentals and others. Thus, they must pay a levy of 0.4% of their revenue. The government said the levy would raise a fund of £100m each year. 

Stakeholder consultations will proceed

The UK government will launch an eight-week consultation regarding the design of the proposed gambling levy. UK Gambling minister Stuart Andrew stated, “Gambling firms should always pay their fair share, and this new statutory levy will ensure that they are legally required to do just that.” 

Overall, the approval of the proposed gambling levy will generate more funds essential to support players from the UK experiencing or recovering from gambling addiction. Fundings for further research and treatment of gambling addiction will benefit both UK punters and casino operators. As the UK government pushes the statutory levy, it will ensure that both land-based and online gambling companies contribute a fair share of the gross revenues.