The Impact of the UK Gambling Tax Reform on the Labour Market

The UK has one of the most robust gambling industries in the world, with a wide variety of markets, consumer protections, and a strong regulatory framework that has helped the industry thrive.

However, plans to implement higher tax tariffs on the industry could have a negative impact, according to industry insiders and experts.

The UK Gambling Industry

With legal online and land-based sports and casino betting markets, the UK has one of the most accessible gambling markets. Market trends have shifted more towards online operations, and many of the top operators, including Ladbrokes, William Hill, Coral, and Betfred, have cut back their high street presence.

 

The move away from land-based betting offices comes at a time when all industries in the country are looking at more cost-effective ways of operating. Online operations represent a way of reaching a wide market without the same level of staffing or costs associated with physical premises.

This suits consumers who are able to visit the biggest names in gambling, as well as the best independent casinos, to enjoy a variety of games, competitive offers, and improved access.

The UK Gambling Commission identifies slots games as the most popular online betting market, accounting for £3.6 billion of the £4.4 billion gross gaming yield taken between April 2023 and March 2024. The growth of the industry means that this figure is likely to grow in the coming years. 

The sports betting industry continues to perform well, with football being the biggest market. Premier League action is the most popular market, but other UK leagues also provide sports fans with the ability to back their favourite teams and those taking part in live fixtures.

The 2026 FIFA World Cup will be a massive boost to the sports betting industry in the UK, taking place between June 11th and July 19th 2026. There is usually a lull during the Summer when there is little local football action; however, the biggest international tournament will provide lots of markets and opportunities, with games being broadcast across different channels.

Gambling Tax Reform Proposals

However, proposals to increase tax on betting markets could have a negative effect on the industry. The IPPR (Institute for Public Policy Research) published a list of proposals that could raise as much as £3.2 billion if they are implemented.

Online and land-based sports betting could see tax increase from 15% to 30% under the new proposals, with cash-prize slots duty going from 20% to 50%, and remote duty on online bingo, poker, and slots rising from 21% to 50%.

This is the first time since 2001 that the UK betting industry could see a big change to how it is taxed. In October of that year, General Betting Duty changed to 15% on gross profits. Previously, betting operators were charged at a rate of 6.75% on all off-course bets, with the industry passing this charge onto bettors at the higher rate of 9%.

Bettors would have the option of paying an additional 9% when placing a bet to enjoy tax-free winnings, or pay their standard stake, with their winnings being taxed at 9% instead. The change favoured bettors who no longer faced tax on winnings.

IPPR Report Flaws and Potential Impact on Labour Market

Despite reports projecting massive increases in tax revenue, experts say these predictions are flawed and are based on current figures. The potential impact of these changes includes betting operators reducing odds as a way of recouping the losses they would face.

Reduced spending as a result of poorer odds would decrease any potential tax increase that has been projected. There are also concerns that implementing higher tax levies on licensed UK operators could drive consumers to explore illegal or offshore betting sites. This could result in as much as £8.4 billion being diverted from the UK market to alternatives that would not contribute to these tax increases.

Despite the gambling industry remaining strong, more than 3,000 land-based betting shops have closed between 2015 and 2025. While this is for a variety of reasons, including restructuring to factor in the growth of online operations, it is feared that tax rises will result in further closures.

A spokesperson for Betfred estimated a loss of approximately 7,000 jobs if the tax increases are pushed through. This would come with the closure of 1,300 betting shops. The impact would be even greater across the industry, with an estimated 40,000 of the 109,000 direct and indirect jobs in the industry being put at risk.

Insiders are hopeful that a full review will take place before any changes are made, with the potential best-case scenarios already being put forward being weighed up against the potential job losses and industry impact.