Paddy Power Co-Founder Rejects Black Market Excuse on Gambling Taxes

The debate around gambling taxes in the UK is heating up, and few voices carry as much weight as Stewart Kenny, co-founder of Paddy Power. Once at the heart of the betting industry, Kenny is now one of its most outspoken critics. His latest comments challenge the industry’s go-to argument that higher taxes will drive bettors into the arms of illegal operators.

Good to Know

• UK gambling operators are forecast to earn around £4 billion globally in profits this year.
• The Treasury expects to collect £3.8 billion from current gambling levies.
• Paddy Power’s parent company Flutter projects annual profits of £2.45 billion, up nearly 40%.

Kenny, who left Paddy Power in 2016, admitted that during his time as an executive he leaned on the black market argument to fend off political pressure. “I’m embarrassed to admit this…we knew it was way exaggerated but it is the perfect way of saying ‘the government will lose money’ – but in fact it won’t,” he said.

His remarks land at a time when Chancellor Rachel Reeves faces calls to raise gambling taxes to help fund welfare programs and address problem gambling. The push follows another quarter of strong results across the industry, with major bookmakers reporting soaring revenues despite growing public and political pressure.

Executives at top firms, however, are pushing back. Peter Jackson, chief executive of Flutter, argued that keeping taxes at current levels is vital to protecting players. “It’s really important (to) keep customers in the legitimate market where we can make sure we can look after them,” Jackson said. Flutter owns Paddy Power and several other high-profile betting brands.

Evoke, the parent company of William Hill, has also taken a clear stance. Finance chief Sean Wilkins warned that increasing the tax burden will “only lead to a growth in the black market.” Analysts estimate Evoke’s profits at around £362 million this year.

Meanwhile, Entain chief executive Stella David, whose company operates Ladbrokes, raised concerns about what she called “the law of unintended consequences.” Like other operators, she believes tougher tax policies could disrupt consumer protection efforts by making illegal platforms more appealing.

Despite the industry’s warnings, the government has shown growing interest in rebalancing the tax system. The Office for Budget Responsibility expects to pull in nearly £3.8 billion from existing gambling taxes this year, but campaigners argue that a bigger slice should come from companies that continue to post strong profits while problem gambling remains a national issue.

In March, Kenny had criticized the UK’s new online slots legislation. Speaking on BBC Radio 4, he acknowledged that stake limits are a step forward but argued they fall short of offering real protection for vulnerable players.

The post Paddy Power Co-Founder Rejects Black Market Excuse on Gambling Taxes appeared first on iGaming.org.