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- Reports suggest the government could double some taxes levied on the sector
- Entain shares fell more than 10% at the open, while Flutter shares also fell
London-listed gaming shares fell sharply on Monday as investors reacted to rumors of an impending tax raid on the sector.
Ministers are planning changes ahead of the October 30 budget that would see £3bn raised from the sector to help heal Britain’s fragile public finances, according to the Guardian.
The newspaper reports that plans being considered would double some of the taxes levied on online casinos and betting shops.
Shares in Ladbrokes owner Entain have fallen sharply on rumors of an impending tax raid on the industry.
Entain, owner of Coral and Ladbrokes, was the biggest faller on the FTSE 100 in early trading, with shares falling almost 14 per cent in early trading to 661.8p.
Shares in Paddy Power and Betfair owner Flutter fell more than 7 per cent to 17,205 pence.
Both companies have been boosted in recent years by the rise of sports betting.
The UK sports betting market is worth £3.5bn and is expanding at 4.5 per cent annually, but the main focus is the US, where industry revenue is expected to grow. to $18 billion by 2027.
Flutter has become a key player in the rapidly expanding US market through its Draft Kings and Fan Duel businesses.
Meanwhile, Entain has built a presence in the US through its joint venture with MGM Resorts, Bet MGM.
Flutter shares are still up about 28 percent over the past year, buoyed by optimism about the outlook, adding more than 130 percent over the past five.
Entain shares have not fared so well, falling more than 30 percent over the past year despite forecast-beating performance, as the group suffers the impact of growing regulatory pressure in some key markets.
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