Fred Done, the founder of Betfred and the UK’s top taxpayer this year at 83, has voiced grave concerns regarding the potential repercussions of significant tax increases on the gambling industry. In a recent conversation with the Financial Times, Done warned that further tax hikes could lead to the closure of numerous betting shops, adversely affect sectors like horse racing, and speed up the decline of high street retail.
Betfred operates approximately 1,094 retail shops across the UK. Done specifically pointed to the alarming prospect of the Machine Gaming Duty—taxes levied on gaming machines—doubling from 20% to 40%, a proposal currently under consideration by Chancellor John Healey ahead of the Autumn Budget.
The retail segment of Betfred is still heavily reliant on fixed-odds betting terminals (FOBTs) and in-store betting, which, despite a stake limit reduction to £2 in 2019, continue to generate around half of the company’s shop profits. Done stressed that without these machines, retail betting would be "impossible."
Should there be a tax increase, Done predicts that Betfred would have to close 495 shops within a year, resulting in the loss of 2,575 jobs and an approximate £67 million in missed tax revenue for the government.
This year alone, Betfred has already closed 132 locations due to previous tax increases. CEO Jo Whittaker stated, "We have tried hard to protect all our sites and the colleagues who work in them, but the combined impact of higher employer National Insurance contributions, wage inflation, increases in gambling taxes and wider economic uncertainty has left us with no choice," in reference to the announced closures.
Similarly, Evoke shut down 200 William Hill stores in April due to analogous pressures.
Stella David, the CEO of Entain, also expressed concerns about the intended rise in MGD, projecting it could inflate operational costs by £100 million if implemented. Last week, David wrote a letter to the UK Prime Minister underlining the negative consequences that such tax hikes would impose on high street jobs and local communities. "They are people losing their jobs and communities losing long-established high-street businesses," she remarked.
In his interview, Done described these closures as indicative of a larger trend affecting high street retail. He predicted that by 2030, betting shops might vanish entirely. He stated, "I believe that by 2030 we will have no betting shops. The high street will be dead. We’ve already worked it out that with the increases in taxes and salaries and other wages it won’t be worth operating."
Betfred currently sponsors all five of Britain's classic horse races, including the Epsom Derby. He noted that the company had not yet decided whether to extend these sponsorships amid the prevailing tax uncertainties and cautioned that fewer regulated gambling options could push problem gamblers towards illegal outlets.
Done also challenged claims from Dame Meg Hillier, chair of the Treasury Select Committee, who dismissed some industry concerns as “scaremongering.”
Recent sentiments from Burnham further complicated the retail landscape, as he indicated plans to eliminate the "aim to permit" strategy for betting shops and mandated that amusement gaming centers require planning permission to operate.
Done raised questions about the increasing tax burden faced by affluent business owners in the UK, asking rhetorically, "They keep saying those with the broadest shoulders should be paying more tax. Well, how broad do my shoulders have to be? We paid £400 million in taxes as a family last year."
While he expressed personal disinterest in relocating from the UK, he acknowledged that his children might desire to find more tax-friendly environments elsewhere.
