UK LEGAL
Q&A
Following a delay of over one year since the previous government began a consultation on proposals for a statutory levy, a response has now been issued. Northridge Law’s Melanie Ellis reports.
T
his response confirms initial details of the levy including rates and when it will come into force, pending a further response (“in the coming months”) to finalise the distribution of levy funds.
WHAT RATES WILL APPLY TO DIFFERENT OPERATORS? The rates for different operators have slightly increased from last year’s proposals, to facilitate collection of the £100m per year considered necessary to fund the proposed research, prevention and treatment. The new proposal is that the following rates will apply: • 1.1% of GGY from all online operators (excluding remote betting intermediary trading rooms, society lotteries with remote licences and External Lottery Managers) and software licensees
• 0.5% of GGY from land-based casinos and land-based betting operators
• 0.2% of GGY from on-course bookmakers, AGCs and land-based bingo operators
• 0.1% of GGY from Family Entertainment Centres, pool betting operators and
10 DECEMBER 2024 machine technical licensees
• 0.1% from society lotteries, charged on proceeds retained after payouts to good causes and prizes
• 0.1% from external lottery managers, charged on fees charges to society lotteries minus prizes paid out These amounts will be confirmed in the regulations introducing the levy, which could be updated in the future as they will be reviewed every five years. If industry revenues fail to grow in line with inflation (noting of course the upcoming introduction of stake limits and other restrictions arising out of the White Paper, and the fact that unlicensed operators will not pay the levy), there is a very real possibility that these percentages will be revised upwards in 2030.
The October 2023 consultation included a proposal that the levy would be introduced in a staged way, with many operators paying half the applicable rate in year one, three quarters in year two and the full rate in year three. This proposal appears to have been abandoned.
WILL ANY OPERATORS BE EXCLUDED FROM THE LEVY? The previous government’s proposal, as set out in the October 2023 consultation, was that all operators with GGY under £500,000 would be excluded from paying the levy. This the basis that this would mean around 80% of licensees were excluded from the levy. The Government considers it inappropriate for the majority of operators to be exempt from the levy. Nevertheless, it does propose to introduce a ‘de minimis’ threshold so that where a licensee’s levy payment will amount to £10 or less, it does not need to pay. The National Lottery remains outside the scope of the statutory levy.
HOW WILL THE FUNDS BE COLLECTED?
The Gambling Commission will be responsible for collecting levy payments. Under the existing provisions of the Gambling Act 2005, levy payments are to be treated as if they were due by way of an annual fee. This means that failure to make a levy payment that is due will
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