UK Government Considers Doubling Gambling Taxes, Raising Remote Gaming Duty to 50% in Budget Shakeup
Published on by Becky M.
The UK Treasury is reportedly exploring significant tax hikes on UK gambling operators in an effort to raise up to £3 billion ($3.92 billion) in additional revenue. Among the proposals is a dramatic rise in the remote gaming tax, which could see a considerable hike from 21% up to 50%. The initiative targets the online gambling sector as part of a broader fiscal strategy to address a £22 billion deficit.Chancellor Rachel Reeves is expected to detail potential tax hikes during the budget announcement scheduled for October 30, 2024. Her first since Labour won a landslide victory earlier this year. The budget is expected to include initiatives that align with Labour’s agenda, highlighting enhanced regulation and revenue from sectors deemed to contribute to social issues, such as gambling.Currently, the UK’s remote gaming duty is 21%, up from 15% in 2019. The general betting duty on land-based bookmakers is 15%, and pool betting also faces a 15% levy.However, proposals from think tanks, the Institute for Public Policy Research (IPPR) and the Social Market Foundation (SMF) suggest these rates could rise substantially. The IPPR advocates for a 50% tax on “high-risk” gambling products, like sports betting and online casinos, which could raise £2.9 billion annually by 2025. Meanwhile, the SMF suggests a smaller yet significant increase to 42% would generate around £900 million.
Industry Opposition
The Betting and Gaming Council (BGC) has strongly opposed the potential tax increases, warning of severe repercussions for the industry. In response to the government’s reported plans, BGC chief executive Grainne Hurst stated the proposed hikes could lead to business closures, job losses, and harm to industries such as horseracing. “Further tax rises will not only slam the brakes on growth for our sector but threaten jobs and completely derail horseracing,” she saidThe BGC also raised concerns about the possibility of driving consumers toward unregulated, illegal black markets if the cost of legal gambling rises. A spokesperson for the organisation emphasised that comparable markets abroad, which have introduced “draconian” regulations and disproportionate taxes, have seen a surge in black-market gambling. The BGC labelled the proposals as being driven by “anti-gambling campaigners” and described it as based on fantasy economics.
Drop in Share Prices
Since the news of the potential tax hike broke, stock prices of major gambling operators have dropped significantly. Industry leaders such as Entain, Flutter, the Rank Group, and Playtech all witnessed a drop in share price. Entain’s shares fell by 15%, Playtech’s by 13%, Rank Group’s by 7%, and Flutter’s by 9%.It is still uncertain how the government will act on the proposals, but gambling tax reforms will undoubtedly be a significant topic in the upcoming budget as Labour aims to balance fiscal responsibilities with its social agenda.