Just How Will the Mandatory Levy Help Online Gamblers?

Much has been written about the impending increase in gambling tax that will take place in April. That’s not the only bad piece of financial news the industry has received in the past 12 months. There’s also the mandatory levy that was introduced in 2025. How does this affect the industry and can it help people in Surrey?

The new mandatory levy has already raised £120 million since being introduced nine months ago.Just how is such a large sum going to be used? The Department for Culture, Media and Sport (DCMS) has explained this in a recently published report.

Half of the funds received will go towards the treatment of those who are suffering from gambling harm. 20% will be used to research the subject and the remaining 30% put towards prevention programs.

The levy is paid by those gambling companies rated by experts who have been granted a licence to operate in the UK. Just how much each company pays depends on the kind of licence that they hold with the UK Gambling Commission. Online casinos will pay 1.1% excluding the National Lottery who have their own legal framework and already contribute funds in these areas.

There have long been concerns about the levels of gambling harm in the UK. The last major gambling-related legislation came into force in 2005. Since then the industry has seen tremendous change with the growth of online gambling. The past year or so has seen stricter regulation of the UK’s online gambling industry.

This has included maximum stakes being introduced for online slot games and restrictions placed on the bonuses that gambling companies can offer their customers. Further regulation is likely in the future including stricter affordability checks and how gambling can be advertised.

In terms of researching gambling harm, it will be the UK Research and Innovation (UKRI) who will receive additional funding from the mandatory levy. The funds will be used for a new bespoke Research Programme on Gambling (RPG). A new Gambling Harms Research Coordination Centre and Gambling Harms Research and Innovation Partnerships will be assisted.

Another focus will be placed on “rapid” evidence reviews for the RPG. This will help them support future policies. The DCMS say that the new research “will help fill gaps in the evidence base for gambling-related harm to inform policy and practice.” Further funding from the mandatory levy will see “further opportunities” launched by the UKRI.

While the vast majority of gamblers do so for fun without suffering any gambling harm, there are plenty who are not so lucky. When there are plans to open a new casino or other betting premises in Surrey, there are concerns over whether it will see the levels of gambling harm being increased.

The 30% that is being dedicated to preventing gambling harm will go to the Office for Health Improvement and Disparities (OHID). Also receiving money will be both the Welsh and Scottish governments. The prevention programs will not be influenced at all by members of the online gambling industry.

50% of the funds will go to treatment and support services. Monies will be given to NHS England and again in Scotland and Wales. The DCMS commented that this will help the government “increase the level of investment and strengthen the provision of projects and services to understand, tackle and treat gambling-related harm.”  They added that the mandatory levy “represents a generational change to funding arrangements.”

One problem is the growth of the unlicensed black market. These online gambling sites do not make any contribution to the mandatory levy, nor do they make any tax payments to the Treasury. There are fears that the stricter regulation and financial payments will be good news for the black market traders.

Those sites also do not need to adhere to the new rules that have been put in place regarding bonuses and maximum stakes for online slots. It is therefore far unsafer for players to gamble on such sites and more action is required against the black market.

The Betting and Gaming Council have spoken out against the recent changes, especially the tax increases that come into force in April. Their view is that government policy is greatly helping the black market by putting “ rocket boosters” under their “competitive advantage over regulated operators.”

They added that the upcoming tax increases will lead to more customers playing on the black market. This “directly increases risk by forcing people out of the regulated market and into unsafe, unprotected environments.”  That would make the mandatory levy even more important if the levels of gambling harm were to increase as a result.