After months of speculation, think tanks, political opinions and industry pleas, the UK government set the course for the country’s gambling market in 2026 by announcing tax increases.
Chancellor Rachel Reeves declared Labour’s budget in Parliament on 26 November, which included changes to the gambling tax, although the moment was taken away from her due to a leak from the Office for Budget Responsibility (OBR).
From April 2026, remote gaming duty will rise to 40% and the current bingo duty of 10% will be abolished.
In April 2027, a new general betting duty rate of 25% for remote betting will be introduced (excluding self-service betting terminals, spread betting, pool bets and horse racing), while a freeze in casino gaming duty bands in 2026-27 has also been announced, with usual RPI (retail price index – inflation) uprating thereafter.
The UK Gambling Commission (UKGC) was awarded an additional £26m of funding by the treasury through the budget, some of which will be used to tackle the illegal land-based sector.
With the numbers set, the fallout from the industry also met expectations, with many explaining the significant impact the new remote gaming duty would have on investment, jobs and player protection.
OBR estimated that £1.1bn could be raised by the government through gambling tax by 2029-30, but there will also be consequences.
The office predicted that yield will drop by a third due to the tax adjustments, with operators estimated to pass around 90% of the increases through price upticks and reduced payouts, resulting in a consumer demand reduction, leading to a £0.5bn yield decrease by 2029-30.
A potential rise in customer movement to the black market was also accounted for, as well as a likely shift from players to different forms of gambling and operators restructuring their offerings to minimise tax costs, reducing the yield by a further £0.1bn.
Per Widerström, CEO of evoke, called the budget “highly damaging for the economy and consumers” as well as “ill-thought-through” and “counterproductive”, noting that it will impact jobs, UK investment and player protection. A strategic review of its operations has since been announced by the William Hill, 888 and Mr Green operator.
Some operators, such as Flutter Entertainment, believe they are well-positioned to pass through any storm that the incoming tax hikes create, but they also still think the changes will be a boost to illegal operators.
Kevin Harrington, Flutter UKI CEO, commented: “The Chancellor rightly wants to address harm, but these changes will hand a big win to illegal, unlicensed gambling operators who will become more competitive overnight.
“These black-market operators don’t pay tax and don’t invest in safer gambling. At 40%, the UK’s Remote Gaming Duty is now above countries such as the Netherlands, where a recent tax increase saw a rise in illegal gambling and a fall in Government receipts.
“Despite this impact, I am confident that through both our scale and leading position in the UK, as well as the proactive cost initiatives that we are taking, we are well placed to navigate through today’s changes.”
Warnings have also been issued that treatment and prevention services could be affected by the tax increases since statutory levy funding is largely driven by contributions from online gambling operators.
Speaking on iGaming Daily, Dan Waugh, Partner at Regulus Partners, said: “If spending in the licensed market is reduced as a result of these tax changes, funding for treatment services in this country will fall. That’s a straight mathematical equation, that’s not our opinion, that is just what will happen.
“It’s worth reflecting that if you look at projected funding from the statutory levy to fund treatment services and other harm prevention measures, about 80% comes from online gaming and betting, it’s more than 50% from online gaming.
“If there is significant displacement from the licensed market into the black market in online casino, the statutory levy that was put in place in April to fund treatment services and harm prevention will collapse.”
With these opinions in hand from industry stakeholders, the UK gambling market is set to enter a new era in 2026.
