Reports of a new mandatory levy on UK gambling firms emerged this week in the Guardian. It’s expected that the gambling minister, Baroness Twycross will be introducing this policy formally as soon as next week. This marks an ambitious and possibly contentious move to help combat gambling harms, but what does it mean for the gambling industry - and us, the players?

The Levy in Brief

The levy that the government is likely to announce was put forward in the gambling white paper last year. It will be a mandatory contribution of 1% of each company’s gross yield. The gross yield is what a company makes before deductions (such as pay, tax, building costs, etc.) This levy is expected to only apply to companies which are earning more  than £500,000 per year. There’s also expected to be a lower rate of 0.4% for land-based operators, due to their higher operating costs. 

At present there is no mandatory levy for gambling companies, but there is the option to make voluntary donations to a small selection of chosen charities. Under the current scheme, GamCare (the largest charity on the list) receives around £50 million in donations each year. Under the proposed scheme, the government expects to raise around £109 million each year.

A Three Part Scheme

All of the funds raised will go directly to organisations that specialise in combating gambling related harm. You’ll see the area referred to as RET which stands for research, education and treatment. Below are examples of organisations that will benefit from the funding from the levy.

• Specialist NHS Addiction Clinics: A fleet of new clinics is expected to be established, offering treatment tailored specifically for gambling addiction.
• Charitable Services: Smaller charities will receive funding to provide education in schools, counselling services, and support for those affected by gambling-related suicides.
• Research: A portion of the funds will likely be allocated to better understand the causes of gambling-related harm and how to prevent it.

Debate Over Fund Management

Despite this plan having not even been announced yet - that’s likely to happen next week - there has already been debate over how the funds are likely to be managed. At present, GamCare receives the vast majority of voluntary contributions, but there’s speculation that this could be about to change.

The Guardian reported that ‘Sources familiar with the plans said the Office for Health Improvement and Disparities (OHID) was vying with GambleAware to be the government’s preferred destination for funds…’

If this is the case, then GamCare is likely to receive less funding overall as a result. It’s highly unlikely that the big six companies donating to GamCare will continue to donate voluntarily at the same level, if they’re also having to pay a mandatory levy.

Where Will the Money Go?

Until this is officially announced, we can’t know for sure where the money will go. However, it’s expected that a fleet of new specialist addiction clinics (run by the NHS), and a range of smaller charities will receive the bulk of the funding. The charities will work across a broad range of services, including education in schools and counselling for those affected by gambling addiction. 

Response from Industry

The new levy is part of a series of changes that were put forward in the gambling white paper from April 2023. Others have included affordability checks and stake limits which have been largely friendless however their implementation has been proposed. The 1% levy on the other hand has received a positive response with industry body, the Betting and Gaming Council, largely in support, as long as proper precutions are taken to protect smaller and land-based operators. 

And for slots players it can only be a good thing as it helps drive a more responsible and safer industry.