Members of Parliament (MPs) engaged in discussions this week about the proposed increase in gambling taxes, set to take effect in the coming years. The debate focused on the potential effect of these tax changes on both the regulated gambling sector and the unregulated market, with concerns that higher taxes might inadvertently drive players toward illegal gambling platforms. The government’s decision, announced last November, will see the Remote Gaming Duty rise from 21% to 40% in April, with the General Betting Duty increasing from 15% to 25% by April 2027. This move is part of a broader strategy to raise funds for mitigating gambling harm.
An essential aspect of the debate involved the possibility that higher taxes could force licensed operators out of the market, thereby leading customers to the black market. Conservative MP Louie French cautioned against the potential “unintended consequences” of these tax hikes. He noted that when the legal, regulated market is weakened by policy decisions, such as steep tax increases, gambling activities may not decrease but rather transition to the illegal sector. French underscored that the black market operates without the safeguards and accountability present in the regulated market, posing significant risks to both children and adults.
The debate also touched upon the social impact of gambling, particularly on children and young people, with MPs generally supportive of the tax hikes as a means to fund efforts aimed at reducing gambling-related harm. Labour MP Alex Ballinger advocated for taxes that specifically target the most harmful forms of gambling, such as online slots and casinos. He argued that these measures would not only protect individuals but also incentivize gaming companies to avoid these high-risk areas.
In addition to the tax increases, Parliament discussed the Statutory Levy introduced in April 2025, designed to provide resources for research, prevention, and treatment of gambling-related harm. Labour MP Kevin McKenna welcomed this development, highlighting its focus on children living in poverty and its potential to mitigate gambling-related social issues. Fellow Labour MP Jim Dickson expressed optimism about the government’s steps to ensure that levy funds are directed towards research and the treatment of at-risk communities.
Despite the support for these measures, there remains concern about potential job losses and business closures within the gambling sector. As MPs debated the Finance Bill, which encompasses the proposed tax changes, the apprehension extended beyond the black market to the economic implications for the industry. Operators like Entain and Evoke have previously expressed fears that significant tax increases could lead to decreased demand and a shift toward unregulated markets, where consumer protections are minimal and tax revenue is non-existent.
James Wild, the shadow exchequer secretary to the Treasury, noted that extreme tax increases might alter consumer behavior, resulting in a downturn in tax yield as activity gravitates toward the unregulated sector. Labour MP Gareth Snell cited a report from the Office for Budget Responsibility, warning that these tax adjustments could fuel a burgeoning black market, ultimately harming the economy.
In response to the debates, Grainne Hurst, CEO of the Betting and Gaming Council, urged the government to adopt an evidence-based approach to tax policy. She emphasized the tangible consequences of further tax hikes, which she argued could lead to job losses, shop closures, and a shift towards unsafe and unregulated markets. Hurst noted that the regulated gambling industry supports a significant number of jobs and contributes £4 billion annually in tax revenue, playing a crucial role in funding sports, charities, and responsible gambling initiatives.
The next steps for the UK government involve careful consideration of these perspectives as they move forward with implementing the tax changes. Monitoring the impact on both the regulated and unregulated gambling sectors will be critical, with potential adjustments made to balance the goals of raising revenue and minimizing harm. The tax increases are set to begin in April, marking a critical juncture for the UK’s approach to gambling regulation and its associated economic and social outcomes.