Next week, during the budget announcement, Chancellor Rachel Reeves is anticipated to propose an increase in the taxes paid by gambling companies. This follows a period of lobbying and speculation concerning potential changes. The tax increase could have a significant financial impact on the industry, estimated to range from £1 billion to £3 billion.
Gambling taxation is structured through several rates: Remote Gaming Duty (RGD) applies a 21% tax on profits from online games, Machine Games Duty (MGD) imposes a 20% tax on slot machines, and General Betting Duty (GBD) at 15% on sports betting. Last year, these duties generated approximately £2.5 billion from total industry revenues of £11.5 billion.
Suggestions have emerged from thinktanks like the IPPR and SMF for increasing the various tax rates, with proposals including raising RGD to over 50% to generate additional revenue. Critics of the proposed increases claim that such changes will lead to job losses, drive customers to unregulated operators, and reduce overall tax revenues. Reports indicate that substantial job losses could occur, with estimates suggesting that 40,000 jobs might be at risk due to the proposed changes. However, this analysis has been disputed by some experts.
Concerns have also been raised about the concept of “scaremongering” within the industry’s responses to potential tax increases, as evidenced by accusations from a Treasury select committee. Industry representatives have previously made dire predictions during earlier regulatory changes, which did not materialize as expected.
Additionally, the ongoing appeal of the illicit market may grow if taxes are raised, as customers often seek better incentives that regulated operators may not be able to provide. The horse racing sector specifically relies on revenue from bookmakers, and underlying tensions between racing interests and gambling companies have emerged regarding tax distribution.
Overall, the expectation is that the Treasury may initiate a moderate rise in taxes, focusing primarily on RGD while attempting to strike a balance that minimizes job loss and economic disruption.
Source: https://www.theguardian.com/society/2025/nov/21/how-could-reeves-hit-gambling-firms-and-are-they-fearmongering-over-impact