It is no secret that the online gambling industry is taking a bigger piece of the pie of the overall revenue of the UK market. The gambling tax revenue graph has been increasing since 2007, when the Gambling Act 2005 was implemented. The new legislation opened doors to different forms of online gambling, including casinos, poker, sports betting, and many others.
The Gambling Commission published the latest statistics of the previous financial year from April 2017 to March 2018, which revealed the market’s general income revenue plunge to £14.4 billion, an increase of 4.2% from the previous year. This was contributed by the National Lottery, online gaming, and the Fixed-Odds Betting Terminals (FOBTs). FOBTs refers to all kinds of electronic gaming machines that allow players to bet on the outcome of simulated online games such as bingo, slots, poker, blackjack, and roulette.
Gambling Statistics in 2018
The online gambling sector was responsible for £5.3 billion of the latest figures (higher with 12.8%), with the online share increasing to 37.1%. It was followed by betting (23% share) and the National Lottery (21%). The casinos had 8%, bingo 5%; lager society lotteries 4% while the arcade games had a 3% share of the pie.
The Gambling Commission issued 888 online licenses by the end of March, up by 108 from March 2017. The UK based casino operators had a share of 41%, followed by Malta-based operators with 21%, with Gibraltar and the Isle of Man tying at 7%. Online casino games generated the highest gambling revenue (£2.92 billion), online betting came second (£2.07 billion), bingo (£178.8 million), exchange betting (£160.6 million) and the last was pool betting with (£28.7 million).
Online slot games accounted for 69.1% of the revenue (up by 64.5%) from the previous report. They were followed by table games (including roulette) with a share of 14.5% (down by 1.3 points). Online poker’s revenue share plunged from 5.9% to 3.7% despite having decent revenue increase to £106.6 million.
In sports, football generated almost hast of the general betting revenue (£1.04 billion), followed by horseracing with £610 million, tennis with £144.6 million, while other sports accounted for £259 million. By the end of March, the online gambling industry had 33.6 million active accounts (up with 3.9 million) from the previous year’s report. The registration of new accounts also increased to 35.4 million (up by 4.5 million). Unfortunately, the funds in these accounts dropped from £875.5 million to £784.8 million within the same span.
The Decline in off-line Betting
Contrary to their counterparts, the land-based betting industry revenue dropped by a massive margin of 22.6% (£137.6 million) to £3.25 billion. The off-course bookmakers contributed £3.08 billion, with a decline in rank by 10.6%. The total number of betting shops by the end of March was 254 less than it was at the end of March 2017. The number has been reducing since then and was 8406 by the end of September 2018. Popular operators like Ladbrokes and Gala Coral together closed a total of 96 land-based venues, independent bookmakers closed 94 venues, and William Hill closed 50 while Betfred shut down 13 shops. Over-the-Counter (OTC) betting contributed £1.3 billion (-7.2%) of the offline revenue, which was a decline by £700 million to £8 billion from during the span. The outcome in football, horseracing, and dog racing also dropped significantly during the period. The gaming machines in the off-course bookmakers contributed revenue of £1.8 billion (-2.1%). This is because the government reduced the maximum stakes on fixed odds betting terminals -FOBTs from £100 to £2 by April 2019.
Expectations of UK Gambling in 2019
As mentioned, one of the significant changes to expect in the gambling industry is the reduction of the maximum bet on FOBTs from £100 to £2. This is a move aimed at dealing with the problem of gambling addiction that has been criticized over the past years. The implementation of this law will have a big impact on casino operators and could lead to the shutdown of many street betting shops. The effect will not only be felt by operators only, but also the HM Treasury could end up losing more than £100 million annually. Additionally, the Point of Consumption Tax is expected to be raised to 21% from the previous 15% to compensate for the loss the government will incur.