It may surprise many of our regular readers, but despite stumbling through a module on political economics as a 19 year-old first year university student I am not a qualified economist.

I am, however, a qualified journalist, with a nice masters’s degree certificate to prove it and everything, fancy myself as a political commentator as many podcast listeners will have heard, and have found myself working in the betting industry for around six years now.

As such, the conversation around betting taxation and the different political views that have been aired around this have caught my interest. And personally, while I understand why many feel that taxes on gambling should be raised, I do think there is another moral argument at play here.

The numbers

As I’ve just said, I get why many people want to see betting firms pay more in tax, particularly at a time of economic strife, political tensions and high living costs from bread to water to energy to the now infamously expensive Freddo chocolate bar.

According to the Gambling Commission, UK gross gaming yield was £15.6bn as of March 2024. We are now in the midst of the interim results reporting season, which always lays bare just how much money gaming firms in the country make.

In Q2 alone, Flutter Entertainment (operator of Paddy Power, Sky Bet and Betfair) made $936m from UK operations, Entain (Ladbrokes and Coral) made £1.09bn and Evoke (William Hill and 888) made more than £600m from retail and online activity.

Political figures like former PM Gordon Brown, who has been working as a consultant for the government on gambling taxation and child poverty, believe that by taxing gambling heavier the latter issue (child poverty) can be better addressed.

Other stakeholders like the SocialMarketFoundation think tank and the MPs of the All Party Parliamentary Group on Gambling Reform, led by veteran reform advocate Iain Duncan Smith, believe that gaming should be taxed higher because of its societal impact.

The Gambling Commission estimates that around 2.5% of the British population suffer from problem gambling, based on its surveys and the Problem Gambling Severity Index. Other researchers believe this figure is higher.

So, finally, this brings us on to…

The moral dilemma

Problem gambling is a consequence of the betting and gaming industry in the same way overconsumption of other products can lead to negative effects – whether this be alcohol or high sugar foods, etc.

It is therefore a responsibility of the companies involved to ensure problem gambling is minimised, and some like Kindred have set ambitious targets of achieving 0% gambling harm.

There is also individual responsibility at play here, and it should fall on consumers to set their own limits and stay in control when having a bet, in the same way someone walking into a pub should be responsible enough to drink away their entire paycheque.

The issue we have here is that a poorly thought out slapping of higher taxes on the betting industry could in effect just become a tax on problem gambling. Many campaigners have been arguing for years that industry profits are driven by problem gambling.

If this is true, then surely making state revenue out of problem gambling is just as immoral?

Same old arguments yet no one is talking

I think what is really needed in this whole debate is better communication. So far we have seen different stakeholders trade blows in the press and via public statements, with both sides making similar arguments.

Many reform advocates clearly see the industry as an immoral one, one which profits off the vulnerable in society by placing betting shops in low income neighbourhoods and makes money from people with addictions.

The industry argues that increasing taxation, and over-regulation in general, would drive people to a black market – an argument that it has made for years and, if we’re being honest, is one that many politicians might be getting tired of hearing.

If we are to reach a good conclusion about how this industry should be taxed, we need the different voices to have a proper discussion and weigh up the pros and cons.

Ideally this is what HM Treasury’s consultation on the matter should achieve, but since this still doesn’t involve the opposing sides actually sitting down and presenting their arguments to one another, the debate will just keep going on.

And when it does keep going on, next August we’re going to once again be sitting in 30-degree heat reading op-eds from former politicians calling for tax to be increased or decreased, while the industry and reform advocates accuse each other of crying wolf.

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