UK Confirms Higher Taxes on Online Gambling in Budget Overhaul
UK Government Announces Increased Taxation on Online Gambling
The UK government has introduced significant tax increases on online gambling operators following persistent calls from Members of Parliament and the Treasury Committee. These tax reforms, included in the Chancellor’s recent Budget, are designed to generate an estimated additional GBP 1 billion for public revenue once implemented.
Distinct Tax Changes: Online Gambling vs. Traditional Betting
The new tax framework targets digital gambling platforms, requiring them to contribute substantially more in taxes, while traditional betting avenues such as horse racing and bingo remain relatively unaffected. Officials emphasize the greater social risks associated with online gambling compared to in-person activities, justifying the steeper tax rates on digital formats.
Effective from April 1, 2026, the tax rate on online casino-style games will increase sharply from 21% to 40%. In April 2027, the tax on remote betting, including online sports wagers, will rise from 15% to 25%. Conversely, taxes for bets placed on UK horse racing and at physical gambling establishments will stay the same. Additionally, bingo halls will benefit from the removal of bingo duty starting in April 2026.
HM Revenue & Customs highlighted the rapid expansion of online betting and growing evidence of harm caused by easy-to-access digital gambling products as key factors behind the tax revisions. The Treasury Committee notes that online gambling has expanded significantly over the past decade, driven by mobile technologies and addictive game designs.
Treasury Committee Supports Tax Hikes Due to Social Harm Concerns
The Treasury Committee has repeatedly challenged industry claims that online betting causes no social problems, concluding last year that such arguments lack credibility. They warned that highly addictive online gambling products bring minimal community benefits while risking harm to individuals and families.
Meg Hillier, chair of the Treasury Committee, endorsed the government’s decision to increase online gambling taxes. She described the move as a practical acknowledgment of the harm caused by certain digital betting activities and praised the policy shift toward fairer taxation of online gambling.
The Treasury presents this reform as part of a broader effort to build a more equitable and sustainable tax system. It underscores that while many people engage in betting, activities like attending horse races, visiting beach arcades, or going to local bingo halls generally cause less societal harm. Supporting these traditional gambling venues helps protect businesses that contribute positively to cultural and economic life.
