Asked by
To ask Her Majesty’s Government what assessment they have made of
claims by the gambling industry that their proposed gambling
reforms will reduce tax revenues.
(LD)
My Lords, I beg leave to ask the Question standing in my name on
the Order Paper and declare my interest as chairman of Peers for
Gambling Reform.
The Parliamentary Under-Secretary of State, Department for
Digital, Culture, Media and Sport ( of Whitley Bay) (Con)
My Lords, without speculating on our ongoing review, gambling
duties are based on gross gambling yield. Any changes which
reduced industry revenue would lower tax receipts. Conversely,
changes which reduce harm could cut costs to the Government and
some displaced spending would likely go to other sectors that pay
tax. We will publish our White Paper in the coming weeks.
(LD)
I am grateful to the Minister for his response. I am sure he will
be aware that some £5 billion of gambling companies’ annual
profits tends to come from people with gambling problems or those
who are in danger of having them, costing lives and increasing
the cost to the NHS. Reducing gambling harm would reduce NHS
costs and, with spending displaced from gambling to more
labour-intensive sectors, create up to 30,000 additional jobs and
increase the funding going into the Treasury coffers, as
demonstrated by the NERA report. Does the Minister accept that it
is possible to reduce gambling harm and have a stronger economy
by doing so?
of Whitley Bay (Con)
The noble Lord is right that tackling problem gambling is good
not just for the people affected by it but for the services which
treat it. We are also aware that there is a black market in
gambling and that problem gamblers may be liable to continue
their problem gambling in that area. We are considering both
these things as part of our review of the 2005 Act.
(PC)
My Lords, does the Minister accept that I am not the only one in
this House who is heartily sick to death of being force-fed
gambling adverts before virtually any sporting event carried on
commercial television? If there is a role for punitive taxation,
it is surely to reduce this level of intrusive advertising, which
hits particularly at young people.
of Whitley Bay (Con)
We called for evidence on advertising as part of our review of
the Act. Many people share the noble Lord’s frustrations. Public
Health England’s evidence review did not find evidence that
exposure to advertising and marketing was a risk factor for
harmful gambling, but we are looking at all these issues as part
of our review.
(CB)
My Lords, under UK legislation the definition of gambling is
tightly drawn. It excludes increasingly popular mobile phone apps
such as social casino apps, which require money to get players
started and, once they are hooked, they are given tokens within
the game. Does the Minister agree that extending the definition
would also lead to an extension of the gambling tax?
of Whitley Bay (Con)
As the noble Viscount knows, we have looked also at the harms
associated with online gambling. Indeed, while awaiting the White
Paper and the outcome of our review, we have strengthened the
rules on how online operators identify and interact with people
at risk of harm. We are not delaying in taking action where that
is needed.
(Lab)
My Lords, so far as we are concerned the Government continue to
drag their feet on reforming gambling regulation, with reports
suggesting that the White Paper has been delayed yet again.
Gambling firms pay a significant amount in tax and there is a
balance to be struck—we all like a flutter. However, with the
Exchequer ultimately responsible for the significant costs of
problem gambling, it is right that regulatory and fiscal
arrangements are reviewed. Does the Minister believe it is right
for firms such as bet365 to argue against proposals for a
statutory levy while its boss takes home a salary of £250 million
a year and £97.5 million in dividend payments?
of Whitley Bay (Con)
My Lords, we have sought views from all interested parties as
part of our review of the Act, including the industry, which is
taking action in some areas. We are happy to engage with people
on both sides of the argument. We called for evidence on the best
way to recoup the regulatory and societal costs of gambling,
which includes looking at a levy, and we will set out our
conclusions in the White Paper.
(Con)
My Lords, as a member of the APPG on racing, can I ask my noble
friend how the new framework that he is considering will support
our popular UK racing industry? Can he ensure that it competes
with the Republic of Ireland and France, where the prize money at
the bottom end is much better than in the UK?
of Whitley Bay (Con)
We are certainly aware of the close relationship between racing
and betting. As the noble Lord, Lord Bassam, rightly said, many
people enjoy a flutter and do so without risk of harm. The main
area of concern we are hearing from the racing industry is about
affordability checks. These are important but must also be
proportionate, and we are carefully considering the impact of all
our proposals as part of the review.
(Non-Afl)
My Lords, the vast majority of people gamble responsibly, and
their harmless pastime supports 120,000 jobs in an industry
paying £4.5 billion in tax and contributing £7.7 billion to the
economy, so of course the Minister has got to consider the impact
that new legislation might have on the public finances. While one
problem gambler is one too many, should it not also be borne in
mind that official Gambling Commission figures show that problem
gambling has fallen to just 0.2% of the adult population, half
the rate of the previous year?
of Whitley Bay (Con)
The noble Lord is right: 40% of people gamble at least once a
year, and if you also include people who only play the National
Lottery then most people gamble. Most suffer no ill-effects from
a pastime that they enjoy and brings benefits to the economy.
However, we are also determined to tackle problem gambling and
the misery it causes to many lives, and that is the balance we
are trying to strike through our review.
(Lab)
My Lords, the majority of the online servers on which British
people gamble are located in offshore tax havens. This means that
profits from sales in the UK are booked elsewhere and not taxed
in the UK at all. Can the Minister provide an estimate of UK
corporation tax lost as a result of these arrangements?
of Whitley Bay (Con)
I will not hazard such an estimate from the Dispatch Box, but in
2014 we amended the Gambling Act to introduce a
point-of-consumption regulatory regime. Since then, every
gambling firm which transacts with customers in Great Britain has
to have a licence from the Gambling Commission, comply with
licence conditions and pay duties on their earnings in this
country.
(CB)
The Minister has given a number of figures to the House, as have
other noble Lords, but will he confirm that Public Health
England, in its report of last September, put a figure of £1.2
billion on what it estimated to be the financial cost of problem
gambling? It also emphasised suicide, mental health and all the
other factors that come into play. Will he return to the question
of the noble Lord, , about aggressive advertising?
What does he think the point of advertising is if it is not to
influence people?
of Whitley Bay (Con)
The point of advertising is to influence people and sometimes it
is from gambling companies encouraging people who are not problem
gamblers to gamble with them rather than their competitors, which
is a legitimate activity. The noble Lord is right to point to the
individual levels at which harms can be committed: one suicide is
too many. We want to tackle problem gambling and that is part of
the review of the Act.
of Hudnall (Lab)
My Lords, further to the question that has just been asked, would
the Minister agree that this issue of advertising is not limited,
although it is obviously a problem, to sporting programming? It
is all over the place and is particularly evident on the catch-up
services, where anyone can use the service—it is not age
appropriate in any way. There is no question that the advertising
is extremely aggressive and extremely seductive. The evidence
that the noble Lord referred to from PHE is frankly quite
counter- intuitive. Could the Minister tell us a bit more about
what the Government intend to do about this?
of Whitley Bay (Con)
Awaiting the outcome of our review, we have updated the gambling
advertising code to ban adverts with a strong appeal to children,
such as those involving Premier League footballers and other
sports stars. We are very alert to the impacts of advertising on
different groups, and will not hesitate to take action to rule
out harmful practices. By calling for evidence on advertising as
part of the review, we can keep abreast of the problem and come
forward with appropriate proposals where needed.
(LD)
My Lords, the noble Lord, , drew attention to
the fact that one of the Select Committee’s recommendations was a
statutory levy on gambling. How much is that still on the
Government’s agenda? When bringing any proposals forward on that,
will the Minister remember that the smaller, harmless end of
gambling such as seaside entertainments would be hit by a
punitive levy? Such a levy should be polluter pays and not on the
smaller, more harmless end of gambling. I say this as of Blackpool.
of Whitley Bay (Con)
And I reply as of Whitley Bay. I am very
alert to the important role played by slot machines at the
seaside. We are looking at this area. We have been clear for a
number of years that, if the existing system of taxation and
voluntary contributions does not deliver what is needed, we would
look at a number of options for reform, including a statutory
levy. We will set out our conclusions in the White Paper.
