Flutter cut 1,400 jobs as UK betting taxes rise
Plans to cut up to 1,400 jobs across the UK and Ireland and among British and Irish staff at sites in Portugal and Romania. The Paddy Power owner says higher…
Higher taxes on online gambling are driving a major restructuring at one of the world’s largest betting companies. Flutter plans to cut up to 1,400 jobs, saying it cannot fully absorb the tax increases imposed on the UK gambling industry.
The cuts will affect staff in the UK and Ireland, as well as British and Irish employees at Flutter sites in Portugal and Romania, the BBC reported. The company has not disclosed which roles are at risk.
The decision puts jobs across the betting group under pressure as new tax rates take effect. Flutter said the increases would have a significant impact on the wider market.
Tax changes reshape betting costs
The government announced higher taxes on online casino games and sports betting in its Budget last November, while exempting horse racing. Some changes took effect in April. Remote gaming duty, paid on online casino betting, rose from 21% to 40%.
General betting duty remains at 15% in betting shops. For online sports betting, it is scheduled to rise from 15% to 25% in April next year.
Flutter chief executive Kevin Harrington said the changes had “fundamentally changed” the economic model of the UK betting and gaming industry. He argued that higher taxes had helped “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,” Harrington said.
That cost pressure has a direct consequence for employees: Flutter has announced a specific scale of job cuts, but workers do not yet know which positions will go. The company’s restructuring plan is expected to cost between $80m and $90m.
Company cites pressure on profits
Flutter, which owns Paddy Power, Sky Bet and Betfair, employs 28,500 people worldwide, including 9,000 in the UK and Ireland. The company said on Tuesday: “We continue to expect these tax increases to have a very significant impact on the overall market.”
In its most recent results, Flutter reported a $299m (£224m) pre-tax loss for the three months to June, compared with a $205m profit in the same period last year. Sales rose 3% to $4.3bn, while revenue in the UK and Ireland increased by 4%, driven by growth in online gambling games.
Flutter has previously said UK tax rises would reduce underlying profit by $320m this year and $540m in 2027, before savings or restructuring measures. Betting firms had warned that rising costs could bring job losses and betting shop closures. MPs dismissed those warnings as “scaremongering”.
The company delisted from the London Stock Exchange in August; its shares now trade solely in New York.
Source: bbc.co.uk
