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Paddy Power owner Flutter to cut 1,400 jobs after UK gaming tax hike

United News Business


The world’s leading online sports betting and iGaming operator Flutter, who owns Paddy Power, is slated to cut up to 1,400 jobs in the UK and Ireland

Flutter announced the axing on Tuesday, blaming the UK government’s decision last year to increase gaming taxation in the Autumn Budget.

The gambling giant said the proposed job cuts will impact workers in Leeds and Dublin, but the restructuring will also impact UK and Ireland staff based at Flutter hubs in Porto, Portugal, and Cluj-Napoca, Romania.

It is understood the move will hit around 15 per cent of workers in the UK and Ireland, where it employs around 9,000 staff.

The plans are still subject to consultation, Flutter said in a statement.

Flutter unveils £60 million ‘restructure’ of UKI business

UK and Ireland boss Kevin Harrington said the group was not able to “fully absorb” the impact of the tax hike without cutting costs.

Plans announced in last year’s autumn budget saw the rate of remote gaming duty – the tax on online casino games and slots – increase from 21 per cent to 40 per cent earlier this year.

Paddy Power and Betfair owner Flutter Entertainment has warned the Government’s Budget move to hike gambling taxes will hit its annual earnings by hundreds of millions of pounds over the next two years
Paddy Power and Betfair owner Flutter Entertainment has warned the Government’s Budget move to hike gambling taxes will hit its annual earnings by hundreds of millions of pounds over the next two years (PA Media)

Firms will also see a new 25 per cent rate of general betting duty for online bets from April next year, up from 15 per cent, as part of the budget changes.

It comes amid speculation that Andy Burnham’s Government could increase the rate of machine games duty, which is the tax on fruit machines, roulette machines and other slot machines, at the next Budget later this month.

Andy Burnham’s Government could increase the rate of machine games duty at the next Budget later this month
Andy Burnham’s Government could increase the rate of machine games duty at the next Budget later this month (PA Wire)

Flutter said its restructuring plan is likely to cost between 80 million and 90 million US dollars (£60 million and £67.5 million)

Flutter ‘cannot fully absorb’ UK’s gaming tax

Mr Harrington, Flutter UK and Ireland chief executive, said: “The material increase in betting and gaming duties announced in the UK budget last year has fundamentally changed the economic model of the regulated betting and gaming industry in the UK while helping to fuel the unlicensed, unregulated market.

“As we warned a year ago, we cannot fully absorb a rise of this magnitude without reducing our fixed cost base and therefore must restructure our business so that we can best position ourselves for the future.

“We remain confident that we are well placed to benefit from share gains given our position as the largest scale operator in the UK.”

Mr Harrington added that his “immediate focus” is to provide the necessary support for all of the colleges impacted, admitting that the move will be a “difficult and challenging period” for all.