POC tax increase a bad omen, and no surprise at all

Everyone’s getting very touchy about politics. The more governments spend, the more they tax, the more they control, the more emotional people get about the issues, the more outbursts, the more violence, until it begins to resemble a war of attrition bordering on societal breakdown. We’re not there yet, but all you have to do is read headlines and it’s obvious that the rate of social disintegration is speeding up all over the West. In the US, Donald Trump fans are fueled by a litany of destructive emotions, as are his enemies. Civil political discourse is getting rarer.

It’s the same in the United Kingdom. People are getting madder and madder, social media makes it all the worse, the Brexiters and the Remainers are at each other’s throats, and the anger in the general populace is reflected back in the politicians. On cue, like a clinically depressed patient gravitates to ice cream, they increase their spending to make themselves feel better, which over time makes the populace even angrier because they have less money to spend on their own lives. And the government needs more funding, so they turn to the typical scapegoats that they can always get political points for scalping. That is, of course, the gambling industry.

Is it any wonder that Chancellor of the Exchequer Philip Hammond is now reportedly jacking up the point of consumption tax, AKA the remote gambling duty to between 20% and 25%, up from 15%? This follows Ireland’s increase of the betting tax from 1% to 2%. These tax increases aren’t what will crush UK gambling companies, at least not directly. They won’t help obviously, but what is more concerning is the direction that they signify. Just like every other Western government, the British government keeps going deeper and deeper into debt, which means they’ll have to raise more and more money. If budgets were balanced or debt to GDP raitios were going down, then tax raises wouldn’t be as worrisome. But as financial stresses accumulate, it’s the gambling industry that will be the fall guy. Nobody but the industry itself complains when taxes go up on bookies.

The ironic eye-rolling thing is that the proximate excuse for the sudden increase in the remote gaming duty is precisely the loss in revenue in machine duty from the introduction of the £2 maximum betting stake on fixed odds betting terminals. There’s some chutzpah. Heaven forefend that the government should lose any net revenue even if it’s the government’s own fault. It’s virtually taken for granted that once government has a certain level of revenue, then it is simply unnatural, unfathomable, untenable that the level of revenue ever decrease. Unlike in the actual economy where no revenue stream is taken for granted and must constantly be maintained against competition, once a government leaches onto a new vein, then even if that vein runs dry it has an automatic “right” to leach onto its neighbor without so much as a cry of public protest.