At the KPMG Isle of Man e-gaming Summit last November I produced a chart that listed the various gambling tax increases that had taken place throughout the world since the onset of the recession from 2008. It was a long list that extended to two pages. The message was simple – during hard economic times gambling is an easy source of revenue.
Even so, gambling taxes do not actually raise much money (in the grand scheme of government spending) simply because not enough people do gamble. So money raised is not the only motive for increasing taxes on gambling. Gambling still has a social stigma attached to it and the tax system is very often used to limit its attractiveness.

Janice Turner wrote in The Times last Saturday:
“Every government’s relationship with working-class pleasures is contradictory, even tortured. Balancing tax revenue against populism; pricing people out of their vices while profiting from their weakness; declaring we have freedom to spend while carefully funnelling our spending”.
The betting industry has been caught on the wrong foot and has missed the societal change in attitudes that has taken place. During recessions, and the present one has been the worst since the 1930s, attitudes become polarised and politicians are adept at making it so. 

For example, the Labour Party has criticised energy companies for charging too much, tour operators for raising prices during school holidays, and Government Ministers are posh boys because they went to fee paying schools. Not to mention the onslaught on people and companies who choose to handle their tax affairs in such a way that they legitimately pay less rather than more. 
As for the consumers, they are shopping in places they would never have dreamed of 10 years ago.
During these difficult and bizarre times gambling falls out of favour and quickly and easily becomes a political football. Politicians see money spent on gambling as wasteful and could be put to better use elsewhere. This is a period in which the industry should be treading carefully.
Even so last week’s budget shocked me, especially when a great deal of research is currently being undertaken into FOBTs. I thought the Government should have waited. However, the concern over problem gambling was cast aside as Chancellor George Osborne stated that the B2 class machines in betting shops were “lucrative”, so there was an opportunity to tax them more.
The inference is that no one is allowed to succeed too much in modern Britain without handing over the booty to Government.
But there is more to it than that….<<click here for part 2>>