It appears it’s not just consumers who are suffering in the current financial climate. This week, Carlton Bingo, who is based in Inverness, has reported small signs in improved customer spending, despite suffering from falling profits over the last year.
The brand owns 14 clubs across northern England and Scotland, which saw a downturn in turnover from £36.9 million to £36.8 million between 1st January and 31st December 2011. Its pre-tax profits fell by 82.1% also, due to them only receiving £1.2 million in over-paid VAT compared to £4 million in 2010.
Despite this, Carlton’s Managing Director, Peter Perrins, announced this week that there are tentative signs of improved consumer spending. Yet, he also added that based on current economic data, the company was still expecting “a difficult time ahead,” and likened “forecasting what will happen in the future” to trying to predict the “outcome of a game of bingo” – i.e., next to impossible.
The company is fully expecting further austerity measures by the Government to adversely affect them over the coming year, and Mr. Perrins called for “the realisation by the country at large” that England faces a sovereign debt crisis, having just about recovered from the banking crisis, which will affect the economy as well as UK residents.
Having already been hit hard by the smoking ban in 2007, Carlton complains that it has to pay higher taxes than other businesses in the gambling sector, such as bookmakers and football pools. George Carter, their Financial Director, went on record to say that whilst the company is “happy to play its part in repairing the current fiscal deficit,” it does not see why bingo “justifies a harsher tax regime” than its peers.
The Chancellor of the Exchequer plans to charge 15% on all online gambling profits from 2014, which will affect many online bingo and casino sites which are based both in the UK, and in tax havens like Gibraltar and the Isle of Man. William Hill PLC, the owner of William Hill Bingo and other sites, is already taking on the government over these proposals, arguing that there is no consistent approach being applied to taxation within the EU. Ireland, for example, has proposed online gambling taxes of just 1% in comparison.
What do you think about taxes on land-based and online gambling? Do you think they should be lowered? Perhaps you’re concerned that your favourite club or site may go out of business if profits continue to fall?