UK Bingo Halls Facing Higher Taxes

Posted on May 4th, 2009

In the UK land based bingo halls have been troubled with declining attendance largely due to the national smoking ban. Double taxation has limited profits for many bingo halls. Recently the government scrapped the Value Added Tax (VAT) on bingo halls but then proceeded to raise the gambling tax from 15% to 22% effectively raising the tax by 50%.

The bingo industry launched a well publicized campaign against the VAT which brought slight changes in the bingo industry’s favor. Most bingo providers consider the new gaming tax as onerous as the old VAT. Gross profits will now be taxed at 22%. Many bingo hall operators were outraged by what they perceived as vindictiveness by the government against the bingo industry.

The new tax policy only adds to the woes of the land based bingo industry in the UK. The Rank Group which operates bingo halls across the UK estimated potential losses at £6 million for the current year as the result of the new tax policy. Industry insiders say that any benefit from the removal of the Vat tax would be negated by the new 22% rate.

For the world of internet bingo it’s a different story. The internet bingo industry has been thriving despite the current recession. When the national smoking ban went into effect land based bingo halls experienced a 60% decline in attendees. A survey taken at the time the ban went into effect showed that almost 63% of players indicated they would consider switching to internet bingo.

The recession has also had an effect on the bingo industry. Many bingo players are seeking home based entertainment and internet bingo is a perfect fit for those players. Competition between internet bingo sites has benefited players in the form of larger jackpots, better promotions, and bigger bingo bonuses. It is puzzling why the government seems intent on taxing bingo halls out of existence.

Internet bingo sites are ramping up to get ready for the expected influx of new online players. Many internet bingo websites are using bigger and better bingo bonuses to attract new players and are also providing players perks designed to retain current players. Free bingo bonuses have become popular with players and many players say they ‘shop around’ for the best bingo bonus before signing up at a bingo website. Despite the economic downturn internet bingo has been almost ‘recession proof.’ Clearly times are changing for bingo players in the UK.