Betfred warns tax hike could shut all 1,300 shops, wiping out 7,500 jobs across the UK

British bookmaker Betfred has warned that it may be forced to shut all 1,300 of its high street shops if the government increases gambling taxes in next month’s Budget, a move that could leave 7,500 workers without jobs. The company’s chair, Fred Done, said the proposed rise would make the business unviable and claimed that any further increase could wipe out the firm’s profits entirely.

Chancellor Rachel Reeves has signalled that she is considering higher levies on betting companies as part of efforts to fill a multibillion-pound gap in the public finances. In an interview last month, she said there was “a case for gambling firms paying more”. Her remarks followed calls from former prime minister Gordon Brown, who urged the government to raise gambling taxes to generate an additional £3.2bn a year for tackling child poverty.

In a letter seen by the Financial Times, Betfred’s chief executive Joanne Whittaker wrote to Reeves and culture secretary Lisa Nandy, warning that the proposed changes “would produce the opposite of their intended effect: reducing tax revenue and accelerating black market growth”. She requested an urgent meeting with the Chancellor, arguing that such a move could devastate a sector already under strain.

Fred Done, who co-founded Betfred in 1967 with his brother Peter, went further in his warning, telling the BBC that even a modest increase would push the business to breaking point. “If [the tax] went up to anywhere like 40 per cent or even 35 per cent, there is no profit in the business,” he said. “We would have to close it down. I’m talking job losses — probably 7,500.”

According to someone close to the company, around 330 of Betfred’s shops are already running at a loss, and a tax hike could push many more into financial difficulty. The source said the scale of the rises suggested by some think tanks would trigger a “worst-case scenario” in which the entire retail betting industry collapses.

The warning follows a report published in August by the Institute for Public Policy Research (IPPR), which proposed higher taxes on profitable internet gambling, including online casinos and slot machines. The UK currently has about 5,900 licensed betting offices, employing around 46,000 people nationwide. In its letter, Betfred said that increasing tax rates to the levels suggested by the IPPR “would render the entire retail betting sector financially unviable, leading to the closure of betting shops across the country and the loss of approximately 46,000 jobs”.

The Treasury has refused to comment on speculation about changes to tax policy, but the industry fears that the government is determined to pursue higher levies regardless of the economic fallout. Although gambling firms are exempt from VAT and customers’ winnings are not taxed, operators already face heavy duties on gaming machines, online casinos, sports betting and horseracing.

Betfred’s rivals have also sounded the alarm. Executives at Flutter Entertainment, which owns Paddy Power and Sky Bet, as well as Entain, Rank Group and Evoke, owner of William Hill, have warned that higher taxes would squeeze profits, drive customers towards unregulated online operators, and ultimately reduce the government’s take.

Shares in major gambling companies have already dropped sharply amid reports in August and October that the Treasury is examining potential tax hikes. Analysts at Jefferies said that the measures reportedly being considered “would all but wipe out bookmaker profitability in the UK”.

Fred Done, who has spent nearly six decades building Betfred into one of the country’s largest betting chains, said the company had survived many changes in regulation but could not withstand such an aggressive tax increase. “This isn’t about greed,” he said. “It’s about survival. We’ve supported Britain’s high streets for nearly 60 years. But if these taxes go through, there won’t be a high street left to support.”

With the November Budget fast approaching, Betfred’s warning has sent shockwaves through the gambling industry and beyond. For thousands of employees and communities reliant on local betting shops, the next few weeks could determine whether the sector survives or disappears altogether.