Flutter plans up to 1,400 job cuts after UK online gambling tax increases

Flutter Entertainment, the owner of Paddy Power, intends to cut as many as 1,400 jobs, blaming tax increases on online gambling announced in last year's Budget, BBC News reports. The company, which also runs Sky Bet and Betfair, has not said which specific roles are at risk.

Where the cuts will fall

Staff in Leeds and Dublin are expected to be hit hardest, along with people working for the UK and Ireland business at Flutter's sites in Portugal and Romania. According to the BBC, employees in London, Sunderland, Malta and Gibraltar could also be affected. Flutter employs 28,500 people worldwide, around 9,000 of them in the UK and Ireland.

Kevin Harrington, chief executive of the UK and Ireland division, said the tax changes had altered the economics of the sector and argued they had helped feed the unlicensed market. He said the business would need to reduce its fixed costs and restructure, a process Flutter expects to cost between $80m and $90m.

The tax changes

The Budget raised duties on online casino and sports betting while exempting horse racing. The main changes include:

• Remote gaming duty, paid on online casino betting, rose from 21% to 40% in April.
• General betting duty on online sports betting is due to increase from 15% to 25% next April, while the rate in betting shops stays at 15%.

Flutter has previously estimated the increases would reduce its underlying profit by $320m this year and $540m in 2027 before any mitigation. The firm reported a worldwide pre-tax loss of $299m for the three months to June, against a $205m profit a year earlier, although UK and Ireland revenue grew 4% on the back of online gaming. Flutter moved its share listing solely to New York in August. The BBC said it had asked the Treasury for comment.

Gambling firms had warned that higher costs would mean job losses and shop closures, warnings that MPs had described as "scaremongering". Earlier this year, Ladbrokes owner Entain also announced job cuts.

What it means for business

The announcement shows how changes in sector-specific taxation can quickly translate into restructuring and job reductions, particularly for companies whose revenue is concentrated in online channels. Businesses that supply or depend on the betting industry, and workers in affected locations, may want to watch how other operators respond as the next rate rise approaches.