Paddy Power Betfair Plays Down ₤ 2 Stake Cut Impact Paddy Power Betfair soft-pedals ₤ 2 stake cut effect 8 August 2018 comments 77 Comments Gambling company Paddy Power Betfair has stated it can stand up to the federal government's strategy to cut the maximum bet on fixed-odds betting terminals [FOBTs] to ₤ 2. The company made the statement as it reported a 4% rise in very first half profits to ₤ 106m. "Our shops are more profitable, and surpass on sports betting, enabling them to better hold up against the impact of lower device stakes limitations," the business said. The stake is being cut from ₤ 100. FOBTs generate ₤ 1.8 bn in earnings a year for the betting industry, according to the Gambling Commission, along with taxes of ₤ 400m for the federal government. High footfall "We operate in high-footfall, highly contended locations, which indicates we are well placed to take advantage of competitor store closures," Paddy Power Betfair stated. "In the UK, we do not anticipate the federal government's proposed new ₤ 2 stake limitation for video gaming makers to have a material effect on our retail technique," it included. Rival William Hill, which produces just over half its retail revenues from FOBTs, has actually warned 900 of its stores could end up being loss-making, possibly causing job losses. Paddy Power Betfair stated the proposed FOBT cut to ₤ 2 would reduce its income from video gaming machines by between 33% and 43%. Based upon its 2017 figures, this could suggest profits would fall by as much as ₤ 46m, which it stated totaled up to 2.6% of its overall revenue. It likewise provided a gauge of the government's plan to increase remote video gaming task to offset a few of the lost tax from FOBT. Each one percentage point rise - from the current level of 15% - would result in an extra ₤ 2.5 m of duty to be paid.