Possible Tax Rises Could Further Damage UK’s Gambling Industry

The UK’s online gambling industry is facing not just stricter regulation but also tax increases. If this Autumn does see that happen, it won’t just be bad news for the gambling industry. It could also hit the horse racing industry and racecourses such as Epsom in Surrey.

2025 has already seen some big changes in how the UK gambling industry is regulated. For example, a new mandatory levy has been introduced. This has the aim of raising £100 million a year. Funds will go towards research into and treatment of those who have suffered gambling harm.

This year has also seen new maximum stakes introduced for slot games at UK online casinos, reports Casino Gambler. There have long been concerns over how addictive they can be, especially for younger players Now, those aged between 18 and 24 are not able to gamble more than £2 per spin. For older players the new maximum stake is £5 per spin.

Anti-gambling campaigners would have preferred the £2 maximum stake to be applied to all players. There are also still concerns over the speed of the games.

It will be interesting to see how the changes affect the financial results of those operating in the UK gambling industry. Another concern though is that changes to the gambling tax system in the UK have been proposed. Currently, there is a three-level tax rate system in place. The recently released new proposals suggest the introduction of just one rate, namely a Remote Betting & Gaming Duty.

The fear is that this could lead to higher tax bills in the future. The online gambling industry has already been hit by the rise in National Insurance introduced last year. Tax lawyer Zoe Feller has already warned that higher taxes could make the UK gambling industry “economically unviable.”

A period of consultation was recently held and that gave the industry the opportunity to express their concerns over the planned changes.

The Betting and Gaming Council (BGC) has also expressed its concern over a possible rise in taxation rates. Their CEO is Grainne Hurst who warned against the Labour government introducing a “self-defeating tax hike.”

Her view is that any increase would “not raise more tax.”  Such a move would risk seeing “huge numbers of customers” leaving the licensed and regulated gambling industry. That is already a major concern after the stricter regulation that has been imposed on the online gambling industry this year.

If that was to happen then it would be bad news for all concerned. Licensed gambling companies would lose revenue and that would affect the amounts the treasury receive in taxation. No tax is paid by those who run unlicensed sites so they will not be affected by any  rises.

It’s bad news for gamblers too as the BGC CEO pointed out.  Her view is that the UK gambling industry has “world leading standards on player safety.” However, the unlicensed market is the exact opposite.

Those who gamble at online casinos also face stricter affordability checks. These aim to check that players are able to afford the amounts they are gambling and losing. Again, this is unpopular with players and could see them heading towards the unregulated and unlicensed.

“It’s clear it will not raise more tax, it simply risks forcing huge numbers of customers out of the regulated market, with its world leading standards on player safety, into the arms of the growing, illegal, unregulated and unsafe gambling black market online.

A recent YouGov survey has backed up the concerns. It asked if gamblers would start using the unregulated sites if “sports events like horseracing became more expensive” because of an increase in the tax gambling companies have to pay.   

65% of those respondents who describe themselves as regular gamblers said that they would take that action. Only 23% of gamblers replied that tax rises would be unlikely to see players leaving the licensed sites.

Epsom has been holding horse racing meetings since the 19th century. Every June the world turns its attention to the Surrey course to see who will win the Derby and Oaks. Any tax changes would not be good news for the UK horse racing industry.

Grainne Hurst has said that tax rises would be “catastrophic” for the industry which she says “is already facing a bleak financial outlook.”

A British Horseracing Authority spokesperson has previously said that the consultation period (which ended on July 21) would be “helpful.” However, they fear that if taxes were to rise, they would lead to “unintended consequences” for the industry and leading courses such as Epsom.