Bingo under threat as Burnham plots fresh gambling tax raid

Bingo bosses have warned Andy Burnham that his planned tax raid on gambling will lead to the closure of much-loved venues and the loss of thousands of jobs.The Prime Minister and Chancellor are thought to be looking at doubling duty on slot machines to 40 per cent in the Budget next month as they wage war on betting shops and so-called adult gaming centres (AGCs).But the chief executives of Mecca Bingo owner Rank Group and Buzz Bingo – the two biggest operators of bingo halls in the UK – fear they could become ‘collateral damage’ in any tax raid.‘Unless bingo clubs are protected from such reform, the viability of bingo in the UK will be at risk,’ said Buzz chief executive Dominic Mansour. ‘The numbers for Britain’s bingo could truly be up.’Slot machines are a key revenue raiser at bingo halls across the country as well as in struggling pubs, working men’s clubs and seaside arcades. Rank chief executive Richard Harris, who runs 41 Mecca sites and 47 Grosvenor casinos, said raising machine games duty on slot machines from 20 per cent to 40 per cent would cost the company £35million.Richard Harris, chief executive of Rank Group, which runs 41 Mecca Bingo sites That, he said, would make a quarter to a third of his venues ‘unviable’.‘A large proportion of that quarter to a third would have to close,’ Harris told the Daily Mail and This is Money.This could lead to the loss of up to 25 per cent of Rank’s 6,500-strong workforce in the UK – some 1,625 jobs.And in a stark warning to Burnham and his Chancellor John Healey, Harris noted that many of the sites and jobs at risk are in Red Wall constituencies across the north of England.Writing for the Daily Mail and This is Money, Buzz Bingo boss Dominic Mansour also said venues and jobs are at risk.Warning that even an increase in the levy from 20 per cent to 25 per cent ‘would leave around a third of our estate loss-making’, he said: ‘That would not only put our investment programme at risk but would lead to undoubtedly difficult decisions about clubs and jobs.’He added that a ‘blanket increase’ in machine games duty to 40 per cent – which hit bingo halls as well as adult gaming slot machine centres – ‘risks undoing the positive impact the abolition of bingo duty was meant to achieve’.Mansour said: ‘For us at Buzz Bingo, at its worst this would mean the closing of clubs and would be a huge risk to jobs.’The comments come after the boss of Ladbrokes and Coral owner Entain this week said a doubling of machine games duty could lead to the closure of 1,470 betting shops with the loss of 15,900 jobs.The industry is already reeling from Rachel Reeves’ hike in remote gaming duty from 21 per cent to 40 per cent and the levy on online sports betting from 15 per cent to 25 per cent.Some 5,000 jobs have been lost at bookmakers since the tax raid was announced in her last Budget.The former chancellor also abolished the 10 per cent duty on bingo, however, offering the sector some much-needed respite.Harris, who will hold talks with Treasury officials next week ‘to fight our corner and fight for the colleagues we employ up and down the country’, said he does not believe ministers ‘want to close bingo clubs’.But he added: ‘The risk is they are targeting a specific part of the gambling sector they do not like. The risk to us is that we are collateral damage.‘If you increase the tax rate, that moves both casinos and bingo halls to be loss making.‘If they become loss making, over time we are going to have to close those venues. That is less jobs and investment.‘You then also lose all the other taxes these casinos and bingo halls pay. Economically it’s really clear cut. Within 12 months, if the tax rate goes up the tax take goes down.’ A woman plays on the slot machines at a Mecca Bingo hallWarning of the impact of closures, he said: ‘Bingo clubs are in the hearts of the communities they operate in. It’s a good value night out. And it provides a lot of entertainment to a lot of customers week in week out. We are part of the social fabric of the communities where we operate.‘Casinos are part of the nighttime economy and over the past ten years the nighttime economy has been completely whacked.’He said his staff are ‘living in fear’ of what a tax raid ‘might do to them and their jobs’, adding: ‘The vast majority are in Red Wall constituencies largely in northern parts of the country.’Arguing that bingo clubs are ‘local, social and low risk’, Mansour said: ‘For some members, a visit to their local club is a cheap fun night out with friends. For others, it may be one of the few times in the week when they know they will see familiar faces.‘In an increasingly fragmented world, bingo clubs have become the heart of communities. A local and safe place, where people can go to meet people from their community, share a drink and feel like they are part of something.’A Treasury spokesman said: ‘The Chancellor is fully focused on his priorities, to give families and businesses a bit of breathing space, back British jobs, and drive growth in every postcode, underpinned by a commitment to meet the fiscal rules.‘As has always been the case, decisions on tax are a matter for the Chancellor to set out at fiscal events, rather than routinely commenting on rumour, speculation or proposals.’Don't make bingo the unintended casualty of a blunt tax changeBy Dominic Mansour, chief executive of Buzz BingoBingo has been part of British life for generations. It is one of the few places where people across every culture, diversity and age group can spend an evening together.The Government has rightly recognised the social value of our bingo halls when it abolished bingo duty earlier this year. It understood that bingo is a lower-risk, community-based activity and that the sector has been under real pressure.But ahead of the Autumn Budget, there is growing talk of doubling machine games duty on Category B machines from the standard 20 per cent rate to 40 per cent. Buzz Bingo boss Dominic MansourIf bingo clubs are accidentally caught up in a blanket increase, it risks undoing the positive impact the abolition of bingo duty was meant to achieve.For us at Buzz Bingo, at its worst this would mean the closing of clubs and would be a huge risk to jobs. Unless bingo clubs are protected from such reform, the viability of bingo in the UK will be at risk – the numbers for Britain’s bingo could truly be up.We’ve responded to the abolition of bingo duty in the way policy makers would have hoped. The decision gave the sector some much-needed confidence, with more than £50million now being invested across the sector this year. At Buzz Bingo, we are committing an additional £20million each year, with every one of our clubs set to benefit over the next five years.We are modernising our venues and improving the experience for customers, and we are already seeing the results, with more people coming through our doors to play, meet friends and spend time together. That includes a new generation of players as well as members who have been coming through our doors for years.That investment supports jobs and local businesses, from the painters and decorators improving our venues to the contractors and suppliers working with our clubs.Protecting bingo clubs matters now more than ever. The cost of living is biting, customers are watching every pound they spend and too many of the familiar places where people once met have disappeared from our high streets. Bingo clubs now occupy increasingly rare ground across the country. They are local, social, and low risk.Bingo clubs operate differently from other gambling environments. People come to play bingo and to socialise. That is why they are considered the safest form of gambling.For some members, a visit to their local club is a cheap fun night out with friends. For others, it may be one of the few times in the week when they know they will see familiar faces.In an increasingly fragmented world, bingo clubs have become the heart of communities. A local and safe place, where people can go to meet people from their community, share a drink and feel like they are part of something. Seven in ten players tell us they play bingo to socialise with friends and family, while almost 90 per cent say it is a good way to spend time with other people.That matters when people are socialising less. Our latest research found that 31 per cent of people are going out less, while 57 per cent have cancelled plans because of cost-of-living pressures. More than three quarters said affordability matters when selecting a night out.Those calling for wider gambling tax reform have themselves said bingo halls should not be adversely affected, including MGD advocate Gordon Brown. That distinction now needs to survive the policy detail.Bingo clubs are large physical venues. They need to be heated, lit, maintained and staffed. They offer food, drink and entertainment, often across long opening hours. Making the model work depends on a mix of different revenue streams. Gaming machines are one part of that mix. They are not the centre of the bingo experience, and they are not the main reason customers come through our doors. But taxing one part of the club like this, and hoping it won’t affect the rest of it, would be like taxing the sale of popcorn and assuming it had no effect on the economics of showing films. 'Local, social, low risk': Seven in ten bingo fans play to spend time with friendsBingo clubs operate differently from other gambling environments. People join up as members to play bingo and socialise. That is why they are considered the safest form of gambling. Having a go on the machines is often a fun interlude for players between bingo games, it is not something people do for hours on end – the way people may picture it happening at adult gaming centres, and the piece that the Government and others want addressed.At Buzz Bingo, every pound we generate is reinvested in our clubs and in growing the business. Even an MGD rise from 20 per cent to 25 per cent would leave around a third of our estate loss-making. That would not only put our investment programme at risk but would lead to undoubtedly difficult decisions about clubs and jobs.The Government made the right decision when it recognised the important role bingo plays in communities across Britain to address loneliness and foster community spirit. We now need to be careful that our progress is not put at risk by allowing bingo clubs to become the unintended casualty of a blunt tax change.DIY INVESTING PLATFORMSAJ BellAJ BellEasy investing and ready-made portfoliosHargreaves LansdownHargreaves LansdownFree fund dealing and investment ideasinteractive investorinteractive investorFlat-fee investing from £4.99 per monthFreetradeFreetradeInvesting Isa now free on basic planTrading 212Trading 212Free share dealing and no account feeAffiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. 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