The live bingo industry in the UK has suffered in recent years. In 2007 the imposition of an ill advised national smoking ban emptied many bingo halls and several were forced to close their doors. Then the government decided that for some reason bingo operators should have to pay much higher taxes than casinos and gambling houses. As if that wasn’t bad enough the government gave local governments the ability to set local licensing fees for bingo halls. In several cases town councils quadrupled the cost of an annual bingo license. Fortunately industry experts say that the live bingo industry is bouncing back. Some say that internet bingo has created a whole new generation of younger players. Many young players first learned the bingo game online and became curious about live games at bingo halls.
The bingo industry received a rare piece of good news from the UK government. The treasury has announced that bingo companies will enjoy a £10 million a year tax cut. The tax cut was in an amendment to the Finance Bill and is in addition to a £25 million tax cut which was announced by Chancellor Gordon Brown in his Budget. The tax cuts are designed to help the bingo industry compete with the National Lottery and other forms of gambling. Bingo industry estimates say that the tax cuts could result in £125 million per year more in prizes and player perks and benefits. Experts also say the reduced taxes will result in half a million more visits to bingo halls and will increase the bingo industry’s profits by £30 million pounds.
The new amendment changes how the gross profit taxes are calculated. In the past no allowance was made for the VAT, or value added tax, and the GPT (gross profits tax) was payable on all of the gross profits. Under the new tax system, GPT will be charged after the VAT has been deducted resulting in massive savings for the bingo industry. John Healey, The Economic Secretary to the Treasury, stated “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.”
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