Bookies Cry ‘Reckless’ Over Tax Hike Proposals—But Why Should Punters Care?

It’s budget season again, Rachel Reeves is in the spotlight, and once more the Treasury has its eye on a juicy target: bookmakers. It seems that taxing gamblers is as reliable a strategy for plugging holes in public finances as blaming the weather for poor festival turnout. This time, though, it’s the Institute of Public Policy Research (IPPR) and the Social Market Foundation (SMF) leading the charge with proposals to slap double-digit tax hikes on the betting industry. The idea? Tax gambling like tobacco, booze, and junk food, and help cover the £22 billion hole in public finances left by… well, let’s just say ‘past choices.’

Unsurprisingly, both the British Horseracing Authority (BHA) and the Betting and Gaming Council (BGC) are warning that these proposals could spell disaster for both racing and gambling industries. And bookmakers, led by analysts like Dan Waugh of Regulus Partners, are sounding the alarm about the potential fallout of these so-called "reckless" measures. They paint a dire picture: if the government dares to double the general betting duty from 15% to 30%, the industry’s margins will vanish faster than a favourite going backwards in the final furlong at Cheltenham. Shares in betting giants like Flutter, Entain, and Evoke have already taken a nosedive at the mere whiff of these proposals.

But here’s the burning question for us punters: Why should we care? Especially when the bookies have made the betting experience as hostile as a mid-winter meet at Market Rasen.

Double Duty: A ‘Moral Crusade’ or a Quick Fix for the Treasury?

The IPPR’s argument is that gambling, like sugary drinks or cigarettes, is a burden on the NHS. Their latest report lumps betting in with everything from fizzy drinks to fags, saying we should tax gambling under the "polluter pays" principle. On paper, it sounds reasonable. But Waugh has rightly slammed the IPPR’s position as nothing short of a "moral crusade." According to him, this is just a group of do-gooders who want to police our vices: “They don’t want us to eat pizza, have a bet, or drink a beer,” he said. Well, that’s half my weekend up in smoke!

And he’s not wrong. These think tanks seem to have a moral aversion to gambling rather than an economic argument for taxing it to death. Waugh argues that if the Treasury raises gambling taxes too sharply, bookmakers will pass on the costs to consumers. This means worse odds, fewer promotions, less marketing, and a possible cut in sports sponsorships. Suddenly, what used to be a flutter on the football or a cheeky bet on the horses will feel like a daylight robbery.

But here’s the reality: for most punters, the bookies have been running a racket for years. Winning punters are routinely shut down, accounts limited, and promotions reserved only for those who lose more than they win. So why should we cry crocodile tears for an industry that’s been more interested in tightening margins and protecting its profits than providing good value for its customers?

The Punters' Predicament: Why Should We Care?

Let’s be blunt—if you’re a punter in 2024, you’re not exactly feeling the love from the bookmakers. We’re in an environment where winning punters are banned or limited, and it’s increasingly difficult to find a decent bet that doesn’t involve handing over half your life savings in verification checks. The same bookmakers now crying "wolf" over tax hikes are the ones who’ve made it their mission to bleed punters dry, offering worse odds, restrictive limits, and shutting down anyone who dares to win too often.

So when the IPPR says they want to double general betting duty to 30%, you might ask: what’s the problem? The bookies aren’t exactly handing out value at the best of times, so would things really get worse? Flutter Entertainment, Entain, and Evoke saw their shares drop this week, with grim warnings from analysts about reduced profitability if taxes are raised. But if you’ve been in a betting shop recently, you’ll know the experience isn’t exactly punter-friendly. Lower marketing budgets? Bookies barely market to winners anyway. Cutting sponsorship of sports? Fine, but maybe stop pocketing millions and start offering odds that don’t make us feel like we’re betting against the house.

Punters have been getting the rough end of the stick for years now. The only ones who seem to get favourable treatment are the mugs throwing cash at the slots or in-play markets with little chance of a win. And yet, here we are, being told that higher taxes will "hurt" the industry. But it’s not the industry being hurt—it’s us, the customers, who’ve already been shouldering the burden.

The Black Market Bogeyman

Waugh’s other big argument is that higher taxes could push punters towards the black market, where unregulated operators can offer better odds. He’s got a point—if taxes force the legal market to slash odds or close up shop in some areas, punters might look for better value elsewhere. The black market argument is trotted out whenever a crackdown is proposed, and while it can be overdone, it’s not without merit.

But let’s be real: for many punters, the black market’s already a viable option. When mainstream bookies are shutting down winners, slashing odds, and offering pitiful customer service, it’s no wonder some have gone rogue. And it’s hard to muster sympathy for a sector that has, for years, treated its most loyal customers like a nuisance.

A Race to the Bottom? Or Business as Usual?

Equity research firm Jefferies is warning that the proposed tax rises could wipe out bookmaker profitability in the UK. They predict that operators will pull back on marketing, sponsorship, and offer punters worse value in terms of odds. But here’s the thing: bookmakers have already been cutting back for years, tightening up on offers and promotions to protect their profits while still squeezing punters for every penny.

The Treasury’s decision in the upcoming budget will be critical. Waugh is hopeful that Rachel Reeves and her advisers will adopt a more sensible, balanced approach and avoid plunging a knife into the heart of the industry. But punters should be asking: has the industry already driven us to this point? And if so, why should we care about bookmaker profitability when most of us feel the bookies have been making a killing at our expense for years?

The Racing Post’s Anxiety: Less Bookie Ads, Less Business?

One interesting angle in all this is how the Racing Post is positioning itself. The paper has been sounding the alarm over the potential hit to bookmakers—and by extension, the hit to racing. But maybe the Racing Post has more skin in the game than it’s letting on. With bookmakers slashing marketing budgets in the wake of any tax hike, the first casualty could be the advertising that props up a sizeable chunk of the Post’s revenue.

If taxes hit bookie profits, expect them to cut back on their flashy ads and pull away from sponsorship deals. That leaves the Racing Post facing a future where it’s not just the race cards that are looking a little thin. It’s no wonder they’re jumping on the anti-tax bandwagon—without bookie ads splashed across every other page, their business model starts to look shakier than a three-legged horse at the Grand National.

The Big Question: What About Racing?

Of course, the BHA and the racing industry have their own reasons to panic about higher taxes on bookies. Racing depends on gambling revenue to fund prize money and keep the sport alive. Higher taxes on bookmakers could lead to a drop in sponsorships, fewer race-day promotions, and—worst of all—lower prize money for owners, trainers, and jockeys. That’s a big problem for a sport already struggling to retain its relevance.

But racing, like gambling, needs to evolve. If the industry can’t protect its own from the effects of a tax hike, it needs to find new ways to engage the public and secure its funding. Depending on the same old bookie revenue streams in an era where betting is under constant political fire is a dangerous game.

Conclusion: Punters, Don’t Shed Tears for the Bookies

As the Treasury weighs up its options, the bookmakers are pleading for mercy, painting themselves as victims of an unfair tax hike. But for punters, the reality is we’ve been victims of poor value, account closures, and a general sense that we’re nothing more than cash cows to be milked until we’re dry. So, if the bookies have to pay a bit more in taxes, why should we care?

The betting industry has spent years making itself hostile to the very people it depends on. Whether the Treasury goes ahead with these proposals or not, punters will continue to face the same problems: poor odds, restricted accounts, and a gambling environment that feels less like leisure and more like a rigged game. Higher taxes might hurt the bookies’ bottom line, but they’ve been hammering ours for years. And if the Racing Post finds itself with fewer flashy bookmaker ads to fill its pages? Well, maybe it’s time the industry had a shake-up.