Clause 20 — Bingo duty

Part of Bill Presented – in the House of Commons at 8:45 pm on 13th May 2009.

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Photo of Don Foster Don Foster Shadow Secretary of State for Culture, Media and Sport 8:45 pm, 13th May 2009

I am delighted to note that the Minister is proposing that, although we have not yet got there and I am suggesting one way of dealing with the problem. I shall come back to gross profits tax at the end of my remarks, but for now let me stick with higher levels of gambling.

If we look into the higher end of gambling addiction problems, many of us know that online gambling is a particular cause for concern. The Minister will be well aware that there are about 6,500 internet gambling sites worldwide, which generate about £12.5 billion that is placed by the punters. Sadly, only about 1,000 of those internet gambling sites are regulated anywhere in the world, but it is at least pleasing to know that about 80 per cent. of all the money spent on internet gambling sites is on those regulated ones. Such gambling is extremely addictive, so it is particularly bizarre that we allow a number of internet gambling sites that are regulated outside the UK—whether they be in jurisdictions that we deem to be white-listed or in other European economic area countries—to advertise in this country. We are meant to spend money to check that their regulatory regime is fine. To date, we have made no charge on them whatever; and neither do we insist that they contribute to research, education and treatment in respect of problem gambling. I am delighted that, at long last, the Minister has given me an assurance that the Government are going to look further at this issue; it does provide another potential source of income.

The Minister also made reference to gross profits tax. Let me tell her that there is a simple way of ensuring that the Treasury recoup any loss that I may be proposing by supporting the amendments this evening—it is by using gross profits tax as the standard way of taxing gambling, and applying it to the national lottery. If such a tax were introduced in the national lottery, as many of us have advocated for many years, it would accrue significant additional income to the Treasury, but, more importantly, it would provide the additional benefit of giving significant extra funds to the lottery good causes, which have recently lost money to pay for the black hole in the Olympic budget.

Although I am delighted that the Minister has removed VAT on participation and that the Government have allowed for an increase in the number of gaming machines, I am disappointed that they are still going ahead with a higher rate of taxation for bingo than for most other forms—often more addictive forms—of gambling. There are ways in which the Government could change the system to provide for higher rates of taxation on more addictive forms of gambling.

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