Did you know that there is a tax on bingo? Back in the 2009 Budget, it was announced that the bingo industry would pay a Gross Profit Tax (GPT) set at 22% in place of VAT.
This resulted in nothing but pain, not only for the operators, but also consumers. Bingo entry fees were increased while prize pots were reduced – all in an effort to pay off the big bingo tax bills and keep businesses afloat. This is also known as ‘bingo duty’.
Bingo Duty is paid on the profits made from both organising and promoting bingo games played in the UK. There are, of course, some exceptions:
Bingo you play in your home
Bingo on a machine that is covered by Machine Games Duty
Non-profit making bingo, where you don’t charge a player a fee to take part
Bingo you play at certain amusement arcades and travelling fairs – if the stakes and prizes are below specific limits
Certain fundraising events
Set higher even than the tax casino based winnings (at 15%), bingo duty caused many complaints about ‘double standards’. High taxes, plus the smoking ban, were in fact blamed for the rapid closure of many bingo halls in the UK – with there now being two thirds less bingo halls in the UK since 2008.
Just last year in 2014, a budget review reduced Bingo Duty to 10%, largely by effort of petition against Chancellor Gordon Brown. Furthermore, the UK treasury recently announced that bingo companies will soon enjoy another tax cut of £10 million a year. It is predicted this will result in an extra £125 million per year in prizes (or the equivalent in reductions of ticket fees), half a million more visits to bingo clubs, and a £30 million overall increase in the industry’s profits.
According to the former Economic Secretary to the Treasury, John Healey; “Bingo is a popular pastime, and one which spans the generations. We want to ensure that it is fairly and proportionately taxed. With this amendment, we have further simplified and reduced the taxation facing the bingo industry – with a total tax break of £35 million.
“We believe this provides a good basis for the industry to increase their prizes and attract new players into Britain’s bingo clubs.”
Bingo generates billions of pounds in stake money, employs 16,000 people across the country and is played by over three million people every week.