Why Betting and Gaming Duty Rises May Subtly Impact UK Players
Over the last couple of years, there have been several big changes to how the UK government is taxing remote betting and gaming operators, i.e., online bookmakers and casinos. For many, the changes were welcome, seen as long overdue. As ever in politics, there was a lot of wrangling to get things over the line, including a lot of pushback from the UK horse racing industry.
However, we now have some clear rules, some of which have already been implemented. For example, on the 1st of April 2026, the rate of tax paid by remote operators on gaming revenues rose from 21% to 40%. A 19% tax rise is quite a hefty one, so it was quite a blow for the operators.
Sports betting taxes will rise next April
In April 2027, it will be the turn of sports betting revenues, which will rise from 15% to 25%. It is not as large, of course, but it is still highly significant. We should note, too, that there are some exemptions. As mentioned, the horse racing industry pushed back on the new tax rules, and it was able to retain the 15% rate. Perhaps surprisingly, taxes on bingo revenues were abolished.
Of course, this can be viewed as a win for the taxpayer and the UK Exchequer. It remains to be seen how much revenue is raised, but we are talking about a multi-billion-pound industry. But will it mean that players will end up being short-changed?
To explain, we must consider that online casino games will use a figure called RTP to dictate how games pay. Typically, for example, an online blackjack game might have an RTP of 99.5%, meaning the casino makes 50p for every £100 wagered. It doesn’t sound like much, but it adds up over time. For slot games and roulette, the RTP is a good bit lower, somewhere around 95% for the former.
Now, if an online casino has just been hit with a 20% tax rise on revenues, it is going to look at ways of protecting its profits. It is possible that it looks at cutting the RTP rate for some games. It is logical to assume so, though not enough time has elapsed yet to get enough data to confirm that.
Players may be pushed elsewhere
Does that mean that playing blackjack at a US casino will be a superior option than playing at a British one? Not necessarily, and a casino can look at other ways to help protect profits, such as cutting the number of promotions it offers, or even cutting staff, something that has become more realistic in this age of AI.
It’s for that reason Brits should also keep an eye out for the changes coming to remote online sports betting in April 2027. It is very possible that this could lead to changes in the odds offered for particular events. Again, this is speculative, and we must remember that it is a highly competitive industry, but it certainly feels like a logical step.
None of this should be surprising – people are talking about similar things with oil companies protecting profits during the Iran War. However, there are also pitfalls for the government. For example, people who are turned off by the odds and conditions offered by British casinos may look to unregulated and unlicensed platforms that claim to offer better terms. For the UK’s bettors and gamers, though, it is something worth keeping an eye on in the coming months and years.
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