We can safely assume that the debate around widely touted UK gambling tax increases is set to have a myriad of new chapters, as battle lines continue to be strengthened.
Most recent reports from the Daily Mirror detail that the Chancellor of the Exchequer, Rachel Reeves, is looking to bring gambling into the remit of sin taxes, alongside alcohol, tobacco and high-fat/high-sugar foods.
This intensifies pressure on the industry, specifically at a time when Stewart Kenny, co-found of Paddy Power, who since his resignation from the operator in 2016 has been heavily critical of the industry, was scathing about the industry’s use of the black market threat.
He stated: “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.”
Kenny’s comments only serve to fuel further speculation around tax hikes within the UK, as industry warnings over the black market threat become more prevalent.
On the other hand, Flutter Entertainment added to the issue with a stark warning against the impact of tax hikes.
Sebastian Butterworth, Director of Racing Strategy at Flutter UKI, emphasised that the touted rises will have a significant impact on future investments in racing.
He stated: “Any increase in gambling tax will have a profound effect on funding for racing – be that a rise in betting duty or a tax raid on people who play games like online bingo and poker.
“We are already having to reconsider certain investments in UK racing, and we urge the Government to reconsider.”
This followed up concerns from evoke and Entain, who both aligned with urging the government not to increase tax rates.
Updating investors during the company’s H2 earnings call, Chief Financial Officer Sean Wilkins urged the Government to be vigilant over what happened in the Netherlands, where significant tax rises led to the surging of the black market.
Wilkins stated: “We want to see a balanced approach from the government to get more cash, but also to ensure the protection of an industry we should be proud of.
“Increased tax beyond a certain point we know leads to black market growth, which leads to less tax take and zero player protection and is completely against the objectives of the Government. This is not speculation, this is evidenced in the Netherlands.”
Rob Wood, the Chief Financial Officer of Entain, also underpinned the organic growth of the industry and subsequently its tax offering.
“Our sector contributes around £4bn every year to the Treasury in the UK, employing over 100,000 people. When you look at Entain, we pay over half a billion pounds to the UK Treasury every single year. That makes us one of the top 20 taxpayers in the country. What’s great all around is that the amount of money is growing, so just through industry growth and a thriving sector, tax take is growing.”
He warned against the UK Government moving to ‘a draconian regime’ like in the Netherlands, which is now facing a major issue in tackling black market engagement.
“The obvious way to mitigate, which we would do whichever tax goes up because we’re one business in the UK, is through consumers. So the odds get worse, the promotions get worse, generosity gets worse, and the consequence of that is black market operators, who don’t pay any tax or have any player protection, pick up customers.
“From the outside, it’s very clear that the losers are the Treasury, the losers are the operators, also sport, because we also have to mitigate through marketing revenues – things like sponsorships go down – employment suffers, so really the only winners are the black market operators. The reassuring thing is we do think that the Treasury knows that and understands that’s true.”
This was evidenced from recent results by the KSA, which detailed that in spite of tax rises, overall tax intake in the first half of 2025 had fallen by 25%.
Further laying out the industry’s vehement stance against the tax hike, the British Horseracing Authority revealed the racing sector would be going on strike on 10 September, a move that prompted criticism from the Betting and Gaming Council.
Nonetheless, they did gain the support of Tory shadow sport minister Louie French, who backed the protests when speaking to City AM.
He said: “The unprecedented move to cancel racing on the 10 September highlights the urgency for the Government to change course and axe the proposed racing tax.
“Rather than backing British racing and positive reforms that will unlock inward investment to our much loved sport, the Government’s latest tax proposals will further fuel the black market, hurting jobs, punters and racing in the process.”
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