Fred Done, the founder of Betfred and the highest taxpayer in Britain this year, has raised significant concerns regarding the future of the gambling industry amidst potential tax increases. During an interview with the Financial Times, Done warned that any further hikes could lead to a devastating number of betting shop closures, adversely impact sectors like horse racing, and expedite the decline of high street commerce.
Currently, Betfred operates about 1,094 retail locations across the UK. Done pointed out the serious implications of the proposed increase in Machine Gaming Duty, which targets taxes on gambling machines. Reports indicate that Chancellor John Healey is considering raising this tax from 20% to 40% in the upcoming Autumn Budget.
Betfred's retail operation relies heavily on fixed-odds betting terminals (FOBTs) and in-store gambling, with FOBTs generating around 50% of shop profits despite their maximum stake being capped at £2 since 2019. Done stressed that without these machines, sustaining a retail betting business would be “impossible.”
Done calculated that such a tax increase could force Betfred to close 495 outlets within just a year, resulting in the loss of approximately 2,575 jobs and a significant £67 million in tax revenue lost for the government. Earlier this year, Betfred had already shut down 132 shops due to a previous increase in remote gaming duty (RGD).
Chief Executive Jo Whittaker lamented the challenging economic climate, stating, "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."
Evoke also closed several William Hill stores—200 in total—in April due to similar pressures.
Entain's CEO, Stella David, echoed Done's fears regarding the potential increase in MGD, estimating it could add £100 million to operational costs if implemented. In a recent letter to the UK Prime Minister, David highlighted the ramifications of such a hike for local workers and their communities: "They are people losing their jobs and communities losing long-established high-street businesses."
Done believes these closures reflect a broader trend that could see betting shops vanish entirely from high streets by 2030. 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, a sponsor of Britain’s five classic horse races, including the Epsom Derby, has yet to renew its sponsorship agreements due to ongoing tax uncertainties. Done warned that diminished regulated gambling options might drive problem gamblers toward unregulated markets.
He also pushed back against Dame Meg Hillier, the chair of the Treasury Select Committee, who dismissed the industry's warnings as “scaremongering.”
In recent developments, Burnham announced plans to eliminate the existing “aim to permit” policy for betting shops while also requiring amusement game centers (AGCs) to obtain planning permission to operate.
Done expressed frustration about the tax burdens placed on affluent business owners in the UK. He questioned, “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 Done has reservations about relocating outside the UK, he admitted that his children might consider moving to countries with more favorable tax regimes.
