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Wednesday, 7 March, 2001, 17:21 GMT
Brown scraps betting duty
The changes take place from 1 January 2002
Punters will be able to bet tax-free in the UK without going to a racecourse or doing so off-shore as a result of the Budget.
Chancellor Gordon Brown announced that the current law, in which the government collects a betting duty of 6.75% from bookmakers and is passed on to betting shop punters as a 9% tax, is being scrapped. Mr Brown gave the news that the industry was waiting for when he said that bookmakers would be taxed on their gross profits at a rate of 15%. The changes come into effect from 1 January 2002.
It will the first time since April 1968 that punters will have the privilege of placing a wager without having to contribute to the government's coffers.
The change has been brought in to stem the loss of betting turnover to the offshore market, which already offers tax-free betting. William Hill chairman John Brown was delighted with the goverment's decision. "It would be great for everybody - the bookmaking industry, horse racing and greyhound racing, and for employees," he said. Punters duped "But most of all it would be great for punters, the majority of whom have never had the opportunity to bet deduction-free." It is believed that bookmaker Victor Chandler's move to offshore betting sparked the government's action. A spokesperson for the company stated that despite the change, punters will still not have a "genuine tax-free option" seen in the offshore industry. "I am delighted that almost two years to the day after we moved our business offshore, the chancellor has decided to abolish the ridiculously high level of betting duty levied in the UK," read the statement. "Victor Chandler will not close its offshore operation. "The betting duty cut announced on Wednesday will not stop UK punters betting offshore. The proposed 15% tax on gross profits is simply another 'stealth tax'. "Regrettably, this looks like a hollow victory for the punters, as they will continue to pay - only this time they won't realise it."
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