No deposit bonuses have traditionally been a very popular way of getting new customers to sign up for online casinos, but many operators are now considering scrapping them as a result of changes to tax regulation in the UK.
The gambling business in the UK continues to be one of the most profitable in the world and those operating casinos employ various incentives to tempt new customers and persuade them to stay. No deposit casino bonuses have proved very popular along with deposit bonuses, free spins, welcome bonuses and also opportunities to win cash and accumulate points that can be converted into cash. Other incentives include discounted betting and cashback. But changes to UK tax rules brought in by the UK tax authorities have led to many casinos axing some of these incentives, particularly no deposit bonuses, and there are now fears that this may result in a fall-off in business in the online casino sector.
No deposit bonuses are a way for casinos to give punters a chance to play without depositing their own money and they have been offered by many of the top names including William Hill, Netbet.co.uk, Play OJO and SkyVegas. The no deposit bonus enables customers to have extra cash to play with without depositing their own money, so players feel they are not taking so much of a risk. With the new tax rules, operators are now reviewing their no deposit bonus policies and some, like Microgaming, and Playtech, have scrapped the bonuses altogether. Instead they are looking at new ways of promoting themselves like the use of social media, creating an enticing environment for customers and coming up with unique games.
“The new rules were put in place to reduce unethical behaviour by some operators while also raising revenue for the government.”
Decline could be on the cards as new tax rules kick in
The change in tax rules has considerably reduced the opportunities for marketing and promotion among casino operators. Some have increased spending on alternative promotions as a result and this, taken together with a reduction in customers who don’t like to take risks, could easily lead to a fall in profits for casinos. Casino profits are also likely to be hit by the new tax regulations. There are fears that this could eventually discourage gambling operators from expanding their businesses leading to stagnation in the industry or even decline. However, it should be noted that despite the changes, gamblers themselves are not facing further taxation. The new rules only apply to casino operators who are now looking outside the UK to places where local laws allow them to use no deposit bonuses to tempt new players without being hit by the tax man.
The UK Parliament feared the new legislation would lead to casino operators transferring their increased costs to customers. There had already been a delay in introducing the measures after casino operators complained to Parliament. The new rules apply not just to companies based in the UK, but also to overseas operators who are licensed to provide their services to gamblers in the UK.