Suggested 'charity tax' on lotteries to take over £1m a year

By Lucy Wynne

The new proposed UK budget is looking into taxing charity donations raised by lotteries.

Rachel Reeves, chancellor of the exchequer, is receiving backlash following the budget’s new gambling levy suggestion - to incorporate a ‘charity tax’ on Britain’s 500 charity lotteries.

The lottery sector is concerned that it will revoke over £1m in donations given to charities across the UK, per year.

The proposed gambling levy will contribute to fund education, treatment and research for those affected by gambling harm. The levy is set to include online and land-based operators for casino and sports betting, as well as arcades, bingo and society lotteries. Originally, charity lotteries were not included in the gambling levy.

In the budget, the Government forecasted to raise £90m-£100m per year, from the gambling levy, by 2027. 

However, despite originally being excluded from the gambling levy, charity lotteries are now being proposed to be included in the levy, which will take an estimated £1m away from British charities, every year. Percentages taken from operator’s gross gaming revenue (GGR) will vary from 0.4% to 1%.

The Local Hospice Lottery has raised circa £10m a year in funds for 40 hospices across the UK and have stated that the charity tax would be equivalent to the cost of 3,200 hours of visits to patients in their own home.

Lotteries Council chairman, Tony Vick, commented: “It is hugely disappointing that the low-risk charity lottery sector is set to subsidise the sort of gambling harms generated by commercial betting and gaming companies via what amounts to little more than a charity tax on civil society.”

Chair of Lotteries Council public affairs, Nick Cook, stated: “We hope that the Government will axe this planned charity tax without delay. While the charity lottery sector accepts that we must be included within the levy framework, we have highlighted clear precedents to allow us to be zero-rated, a move which would safeguard the future charitable return of our member lotteries.”