UK Betting Industry Generates GBP700m In Taxes

by Robin Pilgrim, LawAndTax-News.com, London

29 January 2010

The British betting industry is responsible for a direct economic contribution of GBP3bn in Gross Value Added (GVA) terms, GBP700m in taxes, and 40,700 full-time equivalent jobs, says a new report by Deloitte.

Through the supply chain, the industry also has an indirect economic impact of GBP3.1bn, indirectly supporting 62,300 jobs in sectors such as IT, real estate and retail.

The study, called "The Full Picture," was commissioned by Ladbrokes plc and aims to provide a quantitative and qualitative analysis of the economic contribution of betting. The report reveals that:

• The total contribution to the British economy from the British betting industry is equivalent to 0.5% of GDP and 0.3% of total employment.
• The retail betting industry alone generates GBP700m in wages paid to staff; GBP800m in profits (before interest and tax); and GBP700m is generated in taxes.

In addition to quantifying the economic contribution of betting in terms of both direct and indirect impacts, it also highlights the wider impact of the industry in delivering other socioeconomic policy objectives. This reveals that:

• Betting provides a relatively high number of jobs for workers with no qualifications, boosting employment opportunities and skills development;
• Betting has a regeneration impact because the high levels of footfall associated with betting shops help attract consumers to other retail businesses and generate critical mass effects;
• 15% of horseracing’s annual income is derived from the betting industry;
• The industry also supports employment in rural areas through its links with horse-racing;
• Betting has a positive impact on sports through marketing as well as through direct sponsorships; and
• Public policy is identified as a crucial factor in supporting the industry’s contribution to the economy and maintaining an effective regulatory environment.

Commenting on the report, Simon Oaten, Betting and Gaming lead at Deloitte, said: “The betting industry makes a significant contribution to the British economy – but is subject to intense international competition. With internet and mobile betting growing, the challenge for government is to balance effective regulation with creating the conditions for the domestic industry to compete.”

Christopher Bell, Chief Executive of Ladbrokes plc, commented: “This report comes at a crucial time for the industry and will help inform the government and stakeholders about the important contribution the industry makes to employment and taxation in these difficult economic times. We hope it will contribute towards more informed policy making and help remove much of the uncertainty that has surrounded the taxation and regulation of our industry in recent years.“

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