Britain’s “much-loved” bingo halls are at risk if the Andy Burnham commits to a £460m hike on gambling taxes, the owner of Grosvenor Casinos and Mecca Bingo has said.
Richard Harris, chief executive of Rank Group, said on Thursday: “Tax proposals from anti-gambling campaigners continue to cast clouds over a regulated industry that is proud to support jobs across the country [and] deliver great hospitality experiences to millions of customers.”
The FTSE 250 firm said it paid more than £225m in taxes last year, and warned the government against further tax hikes on the gambling industry.
Ahead of Andy Burnham’s appointment as Prime Minister, a left-wing think tank had speculated that he could raise £460m by hiking tax on slot and fruit machines from 20 to 40 per cent.
Any increase to Machine Games Duty (MGD) ”will further impact venue viability across both Grosvenor and Mecca and will lead to a reduction in tax receipts within 12 months,” Rank Group said.
Though the government scrapped a tax on physical bingo halls earlier this year, the popularity of gambling machines at Mecca Bingo sites means the firm could still take a hit from such a tax hike.
Harris said higher gambling taxes would mean that “much-loved bingo halls and casinos will be forced to close, impacting customers in local communities”.
The group said it is leaning on efforts to drive revenue from its digital machines and electronic gaming at its Grosvenor Casino and Mecca Bingo sites.
Rank trims bingo hall estate
Rank Group posted a five per cent increase in gaming revenue, to £835m, in the year to June, though pre-tax profit slipped by 15 per cent to £39m.
The firm said its statutory profit was affected by a £7.5m impairment charge in relation to its gaming machines.
The business produced an average £7.6m gaming revenue per week at its Grosvenor Casinos arm, an increase of five per cent, which operates about 50 venues across the UK.
The group rolled out 850 new machines across 37 of its casinos in a bid to boost turnover, but said that the Middle East conflict impacted performance in its table gaming offering.
Rank has been trimming down its estate of Mecca bingo halls, responding to an “oversupply” of venues across the UK.
The group has been left with “a much healthier estate of core clubs and flagship venues, well-placed to compete more effectively in their marketplaces,” it said.
Gaming machine revenue jumped by six per cent at Mecca, accounting for 42 per cent of the business’s gaming turnover across the year.
Entain, the FTSE 100 owner of Ladbrokes, on Thursday hit out at the government’s “significant and disappointing” hike to taxes on remote gambling, which it said dragged on its underlying earnings.
