UK Bingo Tax Issue Heats Up

Posted on May 18th, 2009

UK bingo halls have been affected by a double whammy of double taxation and a national smoking ban. When the national smoking ban was passed attendance at local bingo halls declined dramatically. Some halls reported a 60% decline in attendance. Many of these players switched to internet bingo and many internet bingo websites reported that player numbers were increasing.

For some unknown reason the UK government is targeting bingo with a 22% tax. Bingo is the only form of gambling to be singled out for this huge increase in taxes. Most other forms of gaming are taxed at a 15% rate. The increased taxes combined with the residual effects of the smoking ban will in all likelihood cause many more bingo halls to shutter their doors. Davina Warden, manager of Mecca Bingo in Exeter, stated, “Our customers just can’t understand why the Government is targeting bingo. It just doesn’t seem to be fair that someone can go to the bookies and place a bet and only pay 15 per cent tax, whilst one of our customers has to pay 22 per cent.”

The land based bingo industry has mounted a campaign against the excessive rate of taxation. Bingo players from across the UK are making their voices heard and are calling, writing, and emailing their MP’s. The internet bingo industry has benefited greatly from players tired of the smoking ban and excessive taxation. Last year UK based internet bingo websites reported an 80% increase in players.

This should come as no surprise as the internet bingo industry is able to offer larger jackpots, bingo bonuses and prizes and is not burdened with a 22% tax rate. The UK online bingo market is probably the most active in the world and also the most competitive. Internet bingo providers are spending millions of pounds in the UK on television advertising in an attempt to attract new players. Bigger jackpots and bingo bonuses are just a few examples of marketing strategies used by internet bingo sites to attract players.

Bingo sites usually have a free play option so players can familiarize themselves with the online version of the game. Free bingo bonuses and bigger jackpots have been successful strategies for the internet bingo industry. The fate of land based bingo halls in the UK remains to be seen but at present it would appear that the government seems bent on harming an industry that generates millions a year in tax revenue.