A majority of UK players are ready to shift to offshore operators if gambling taxes rise. As consultations on a new Remote Betting and Gaming Duty (RBGD) conclude, the Treasury faces pressure from investors, regulators, and the horse racing sector to reconsider a potentially destructive reform. Operators should be prepared to adapt swiftly if regulatory changes occur.
One Tax to Replace Them All
The UK Treasury plans to unite 3 existing levies:
- General Betting Duty;
- Pool Betting Duty;
- Remote Gaming Duty.
This new model aims to streamline the current system. At the same time, while not live yet, it has already sparked much controversy. The proposal suggests a flat fee of 21% or higher across all verticals. If this rate materialises, industry experts warn of a significant drop in the number of users. Players are most likely to move to offshore platforms.
Grey Market Surge
A recent YouGov survey revealed that 65% of British players would consider switching to offshore operators if tax rates rise. The data aligns with broader patterns. Since 2021, traffic to 22 unlicensed horse racing betting sites has increased by 522%, while legal platforms saw just a 49% growth in the same period.
3 main factors fuel this rise, as the International Federation of Horseracing Authorities (IFHA) mentions:
- affordability checks;
- diminished availability of legal products;
- growing tax risks on regulated betting.
The legal market already shows signs of strain. Since 2021, the volume of lawful online horse racing bets has fallen by €1.9 billion. Despite aggressive enforcement efforts (the blocking of 264 websites and the issuance of 770 takedown orders since April 2024), the impact has not been reversed.
BHA Protests and Dire Forecasts
The British Horseracing Authority has launched a public protest campaign under the slogan «Cancel the Racing Tax.» Demonstrations will continue throughout the summer to raise awareness of what the BHA views as an existential threat to the sport.
Brant Dunshea, the BHA’s acting CEO, emphasised that a tax hike would blow a hole in the finances of the UK’s second-most popular sport. He mentioned it would put thousands of jobs at risk and put the future of the entire racing industry in danger.
Economic modelling supports the concern:
- At a 25% tax rate, the projected loss is $132 million.
- At 30%, it rises to $185 million.
- At 40%, the damage reaches $218 million.
These losses stem from reduced revenues in betting, media rights, and sponsorship.
Operators are expected to counterbalance tax increases through the strategies:
- reductions in player bonuses;
- cuts in marketing and sponsorship;
- price hikes on betting products.
Decision Timeline and Market Outlook
The Treasury’s consultation officially closed at 23:59 on July 21. A policy decision is anticipated by late summer, with the final tax rate to be announced in October during the Autumn Budget. Implementation of the new duty would begin no earlier than October 2027.
The stakes are high. The Treasury must choose between addressing mounting concerns or triggering a wave of player migration to unlicensed markets. The latter could ruin the integrity and viability of the UK’s regulated gambling ecosystem.
Activity Influence
Operators across Britain are preparing for various scenarios. Now is the time to assess strategic risk and reconsider compliance tactics. The new tax model may reshape the landscape. However, proactive adaptation will keep legal operators live.
Casino Market continues to follow developments closely and is ready to support clients with flexible solutions and insights as the reform unfolds. Meanwhile, you can contact our support team and find out the details of a turnkey gambling project in the UK and any other country of your interest.
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