UK Government Making Changes to Gambling Business
Earlier this month, the government of the United Kingdom announced its project to establish an FOBT limit of a £2 maximum stake. The FOBT, or Fixed Odds Betting Terminals, to have the limit for those on the High Street betting offices. The possibility will have a lot of impact in the field, likely on online poker players and tax revenue.
First off, if the limit on FOBT max stake is imposed than the tax revenue will experience a decrease. The UK government is planning on addressing that by increasing the Remote Gambling Duty that online operators have to pay. Fixed Odds Betting Terminals are essentially gambling machines. In the United Kingdom, there are several types of such devices. B1 is the most abundant type of gambling machines, and those can be found in casinos, as well as in High Street betting offices, called type B2, and game arcade machines, called B3.
Each of these gambling machines classes has its limits on maximum stake and payout. The possible limit on max stakes of class B2 gambling machines has been £100 for many years. Campaigners have been concerned about the max stake limit, stating that it is too high and that it can cause too significant losses for new gamblers in just one session. Players that are overly confident are also vulnerable to such failures. That argument has had the UK government rethinking the max stake limit for B2 gambling machines.
To compare, B1 gambling machines has a stake limit of only £5. The new B2 stake limit of £2 was introduced last week, on Thursday. The Minister for Sport and Civil Society of the United Kingdom, Tracey Crouch, stated that the change was made in order to protect those who can least afford to lose from high losses.
Another change that Tracey Crouch announced was also to prevent vulnerable gamblers from losing too much money. Online operators now have to enforce sending limits n their clients until they have presented to the online operators with affordability checks and prove that they are, in fact, able to afford the high spending on gambling. While the changes are there to protect gamblers, there are some financial implications caused by the FOBT limit.
Reducing the maximum stake would cost the gambling industry up to £639 million in lost profits every year. The Department for Digital, Culture, Media, and Sport of the United Kingdom released that evaluation around the time the change was announced. In response to that, the share prices of hundreds of companies in the field tumbled, and both small companies and High Street operators were affected.
The Remote Gambling Duty will be facing an increase which will be one more extra payment that online poker players will have to make. Online poker is the most common form of gambling in the country and o the community will be shouldering most of the taxes, as well as a few of the online operators, and some bookmakers. More changes are in the works which will hopefully alleviate the extra load on some gambling communities.