Joesph Cullis has completed his first year as National President of Bacta. Here, he tells Coinslot how the 12 months have gone, the issues, the achievements and the tricky landscape that the amusements and gaming industry finds itself navigating.
One year into my presidency of Bacta, I am more determined than ever to defend this industry from people who do not understand it, do not value it and too often appear willing to damage it without thinking through the consequences.
The recent Social Market Foundation proposal to increase Machine Games Duty is a perfect example. It treats our sector as an easy target. It talks about taxation as if it is an academic exercise, rather than something that decides whether real businesses survive, whether staff keep their jobs and whether communities keep the venues that have helped sustain them for generations.
That is what frustrates me most.
Our members are not abstract entities on a Treasury spreadsheet. They are family businesses, employers, taxpayers, manufacturers, machine suppliers, engineers, seaside operators, high street investors and community champions.
Many have been operating for generations. They are rooted in the towns they serve. They employ local people, pay local taxes, support local good causes and provide safe, supervised, low-stake entertainment in regulated venues. In many places, these venues are part of the social fabric of the community. They are familiar and visible places where customers are known, standards are enforced and people interact face to face.
Yet year after year we are forced to defend ourselves against campaigners and think tanks who talk about our sector as if they have never stepped inside one of our venues.
Hiking taxes on gaming machines will only damage high streets, seaside towns, working men’s clubs, pubs, bingo clubs, manufacturers and the wider supply chain – damaging exactly the places politicians constantly claim they want to support.
Many seaside piers and amusement arcades rely on income from gaming areas to stay viable year-round. That income helps keep staff employed beyond the summer season. It helps maintain attractions and buildings that are part of Britain’s coastal heritage. Take it away and the damage spreads far beyond the shop floor.
A pier does not survive on nostalgia. A seaside arcade does not pay wages with warm words about heritage. A manufacturer cannot invest in new products if the market is taxed and regulated into decline.
What makes this even harder to accept is that our industry already carries a heavy and highly specific tax burden. Machine Games Duty is a major cost on land-based businesses.
On top of that, operators face business rates, irrecoverable VAT, the statutory levy, rising wage costs, higher National Insurance, energy bills, licence fees and the growing cost of compliance.
The statutory levy is an important point. It was set by Government after extensive consultation to fund research, prevention and treatment of gambling harm, and our sector was placed at the lowest level. That rate reflects the evidence that our venues do not present the risk profile some try to claim they have.
Another point that is constantly misunderstood is Gross Gambling Yield. GGY is not profit. It is not money sitting in an operator’s bank account waiting to be taxed. It is a revenue measure, and from it businesses still have to cover the full cost of running staffed, regulated, bricks-and-mortar venues before any profit is made. Treating GGY as if it were profit is either economically illiterate or deliberately misleading.
Unlike most businesses, our members cannot simply put prices up to recover higher costs. Stakes and prizes are fixed in law and machine numbers are restricted.
So when someone proposes another major tax increase, they are not finding free money. They are threatening jobs, venues and investment.
Our members are expected to absorb attack after attack while continuing to do the right thing, meet every regulatory expectation, invest in their premises and pay their taxes.
That cannot continue unchallenged.
Over the last year, I have made raising standards central to my presidency. Bacta has led from the front on safer gambling, self-exclusion improvements and accountability. We will continue to work constructively with Government, the Gambling Commission, parliamentarians and other stakeholders.
But constructive engagement does not mean accepting bad policy.
If people expect the industry to raise its standards, they must raise theirs too. That means understanding the sector before making sweeping proposals about it. It means visiting venues, speaking to operators and looking at evidence rather than caricature.
Bacta members have been part of Britain’s high streets and seaside towns for generations. We will not allow them to be taxed and talked down into decline by people who do not understand our businesses, our customers or the communities we serve.
Raising standards is not a one-way street
Joseph Cullis said……. “If people expect the industry to raise its standards, they must raise theirs too. That means understanding the sector before making sweeping proposals about it. It means visiting venues, speaking to operators and looking at evidence rather than caricature……
