Great Britain cuts maximum stake on fixed-odds betting terminals
May 18, 2018 9:24 AM
by Robert Mann
Great Britain will cut the maximum stake on fixed-odds betting terminals (FBOT’S) to just two pounds ($2.70) as the government continues to address problem gambling, rebuffing claims that such a big reduction could eliminate thousands of jobs.
The decision follows complaints that the machines, through which gamblers in high street (primary business district) shops bet up to 100 pounds ($135) every 20 seconds on casino games, are too addictive and allowed players to lose large sums of money too swiftly.
“These machines are a social blight and prey on some of the most vulnerable in society, and we are determined to put a stop to it and build a fairer society for all,” Matt Hancock, Secretary of State for Sport, said in a statement on Thursday.
The decision is expected to have a negative impact on earnings for several major betting companies including William Hill and GVC. The companies said that the terminals were a major source of income as younger gamblers move online, putting jobs at risk.
British gambling companies may also face the damaging effects of a new government plan to increase Remote Gaming Duty on online gambling to offset the loss of tax income from the cut in the maximum FBOT wager.
Reuters reports that analysts expect Britain to increase the current 15 percent base levy on online operators by between 3.5 to 5 percent. Reuters notes that the higher local taxes are a factor prompting both companies to seek a major role in the the now expanded legal U.S. sports wagering market.
There are over 8,788 betting shops in Britain with operators allowed to install a maximum of four FBOT’s per shop.
Ladbrokes Coral, bought by GVC for close to 4 billion pounds late last year, operates close to 3,500 high street betting shops across the UK, employing over 25,000 people. William Hill has around 2,300 betting shops employing over 12,500 people.
William Hill has warned regulators that the new, lower limits could lead to a 35 to 45 percent reduction in its annual total gaming net revenue.