William Hill shares down 12% on £2 stake reports
Treasury also seeking to raise taxes on other forms of gambling to make up for FOBT shortfall
William Hill shares dipped 12% this morning after a new report from The Times said the Treasury is backing a £2 limit on FOBT stakes.
GVC stock was also down almost 5% and Paddy Power Betfair down 3% after the report, which said a decision was “imminent”.
Per The Times: “The chancellor is understood to have accepted expert recommendations that stakes for fixed odds betting terminals (FOBTs) should be reduced to £2.
“His allies said that there was growing optimism that an agreement with Matt Hancock, the culture secretary, was imminent. ‘We are very nearly there,’ one said.”
Any announcement must wait until after next week’s local elections.
The report also noted Hammond’s plans to increase taxes on other forms of gambling to make up for the expected shortfall – the treasury banked around £450m via the machines last year.
Online slots could be a prime target for increased taxation, according to Eilers & Krejcik analyst Alun Bowden.
“This is concerning as it could indicate an increase in taxation on online gambling as well as at land-based casinos,” noted Cenkos analyst Simon French.
“In effect this could be a double-whammy for operators who have multi-channel exposure. We think the multiple reports and sources quoted suggest these articles are credible and would expect an announcement after next week’s local elections, with £20 maximum stake now seemingly a non-runner.”
Online-only firm 888 saw its shares down around 2% this morning.