LONDON, Sept 26 – More than 100 Labour MPs have urged Chancellor Rachel Reeves to increase gambling taxes, prompting warnings that the policy could devastate Britain’s betting shops and strip horseracing of vital income.
Industry leaders say the proposed hikes, based on recommendations from former prime minister Gordon Brown and the Institute for Public Policy Research (IPPR), would wipe out shop profits, cut jobs, and drive punters towards the black market.
MPs back higher levies
The call came in a letter to Reeves from members of the Gambling Reform All-Party Parliamentary Group, led by Beccy Cooper and Alex Ballinger. The MPs proposed a “targeted levy” on online gambling to tackle child poverty and related harms, while supporting Brown’s broader reforms.
Brown’s plans would increase remote gaming duty to 50 per cent from 21 per cent, machine games duty on in-person gaming machines to 50 per cent from 20 per cent, and general betting duty to 25 per cent from 15 per cent or even 30 per cent under an earlier IPPR proposal.
Industry voices warn of collapse
Greg Knight, managing director of Jenningsbet, said the measures would be catastrophic for betting shops. “The whole industry would cease,” he warned. “The carve-out for racing would be entirely meaningless because the demise of shops would mean catastrophic reduction in levy, media rights and sponsorship.”
He added: “If they are going to come for retail, I don’t exaggerate, the whole industry would cease. You lose all of that income and you have suddenly got thousands of people out of a job.”
Treasury consultation and next steps
The Treasury has already consulted on harmonising online gambling duties, with racing authorities estimating the change could cost the sport £66m annually. Reeves confirmed she has launched a review of gambling taxation and will set out plans in the November 26 Budget.
“I didn’t need MPs or former chancellors to tell me to launch an inquiry into gambling taxation,” Reeves said. “I’ll set out the plans on the taxation of gambling and indeed of other areas in my Budget.”
Financial impact estimates
Paul Leyland of Regulus Partners calculated that Britain’s betting shops generate around £350m in profits before capital expenditure each year. Raising machine games duty to 50 per cent would add £350m in costs, while a rise in general betting duty to 30 per cent would cost a further £116m.
“Betting shops would need margins in excess of 30 per cent just to absorb a tax hit of this magnitude, which is not the reality for the vast majority of high street shops,” Leyland said. He warned that fewer than 20 per cent of betting shops would survive, costing 30,000 jobs and cutting racing’s income by up to 75 per cent.
Horseracing and wider consequences
Betting shop numbers have already fallen from nearly 9,000 in 2015 to under 6,000 in 2024. Further closures would reduce horseracing’s £100m in media rights and £40m in levy payments, undermining a sport heavily dependent on betting revenue.
The Betting and Gaming Council said: “Any further tax increases on the regulated betting and gaming sector would hit punters hard, as well as risk betting shop jobs, investment, and the vital funding our members provide to sport, including more than £350m a year to British horseracing.”
Political backdrop
The proposals also arrive at a politically sensitive moment for Labour. With the Autumn Budget set for November 26, Reeves faces pressure to find new revenue streams without breaching her pledge not to raise income tax, national insurance or VAT. Gambling levies are viewed by some MPs as a politically easier route to increase tax receipts.
The clash over gambling taxes pits MPs seeking to raise revenue and tackle social harms against an industry warning of mass closures, job losses, and reduced contributions to sport. With the November Budget looming, Reeves faces a delicate balancing act between public health goals and protecting economic activity.
For households and businesses, changes to gambling taxation underline the importance of planning for fiscal shifts. The Pie app helps users track tax changes, expenses, and income, offering clarity as new policies reshape the UK’s financial landscape.
