Although the Chancellor suggested that no rates of duty would increase, he mentioned specifically only those relating to alcohol, tobacco and vehicles. We will be checking the small print in the Treasury press releases to see whether any of the UK’s seven gambling duties are to be affected.
The increase in the rate of VAT to 20% is clearly bad news for UK based (VAT exempt) gambling operators who generally cannot reclaim the majority of the input VAT charged to them by their suppliers. Since VAT is another tax which is suffered by UK based gambling operators but not one which is suffered by those operators who are (for example) based in Gibraltar or Alderney, this tax rise will further increase the taxation disparity between those operators based in the UK and those based offshore.
The new Chancellor, in common with his predecessor, suggested in his speech that the Coalition Government would be looking to dispose of the Tote, as one of the assets which, in George Osborne’s view, should be in the private sector. However, he did not specifically state that he would sell the Tote – he said that he would resolve its future – so exactly what he has in mind is not yet clear.