Key Moments:
- The UK government approved substantial tax hikes for online gambling, while horse racing betting remains at existing rates.
- Remote Gaming Duty will increase from 21% to 40% in April 2026; remote betting duty rises from 15% to 25% in April 2027 (excluding horse racing).
- The British Horseracing Authority praised the move as a vital win for the sector, while bingo duty will be abolished.
Major Tax Reforms Impact UK Gambling Sector
The UK government’s newly announced 2025 Budget brings a series of far-reaching tax changes to the gambling industry, introducing heightened tax rates for online casino games, most online betting, and remote gaming. In a marked exception, horse racing bets, both online and in-person, have been excluded from these increases and will continue at their current tax structure.
| Activity | Current Duty Rate | New Duty Rate | Effective Date |
|---|---|---|---|
| Remote Gaming Duty (online casino/games of chance) | 21% | 40% | April 2026 |
| Remote Sports Betting (excluding horse racing) | 15% | 25% | April 2027 |
| Bets on Horseracing (online and in-person) | 15% | 15% | No change |
| Bingo Duty | Not specified | Abolished | Not specified |
Horseracing Secures Exemption Amid Tightening Regulations
Despite a broader governmental push to harmonize gambling tax rates, horse racing has obtained a high-profile exemption. The sector drew on its perceived cultural significance and the economic contribution it provides, notably in rural regions. Industry leaders and the British Horseracing Authority welcomed the decision, citing the sport’s extensive role in supporting jobs and generating approximately £4 billion annually for the UK economy.
Earlier proposals would have set horse racing remote betting under the same elevated tax regime as online casino games, which industry advocates argued could undermine the viability of racing and related businesses.
“significant” – British Horseracing Authority (BHA)
Wider Industry Braces for Increased Costs
For online gaming and sports betting operators (excluding horse racing), the reforms mean a steep rise in tax rates. Remote Gaming Duty on online casinos and similar services will escalate to 40% in April 2026, while the duty on many remote sports bets will jump to 25% starting in April 2027. The government attributes these steps to both revenue-raising needs and growing concerns about gambling-related harm.
Projections point to annual tax receipts exceeding £1.1 billion by 2029–30 following full implementation. Operators are expected to face notably higher costs, which could lead to reduced player perks and tougher risk controls. In-person betting and land-based gambling facilities, however, will see relatively little change for now, as their duties remain largely unaltered.
Mixed Prospects for Horse Racing
The ruling grants temporary security for the horse racing sector, preserving the 15% duty level and safeguarding jobs and industry revenues. Sector representatives had argued that tax increases could have triggered job losses and prize reductions across the sport.
Yet, even with an unchanged betting duty, indirect effects could arise. Online gaming and sportsbook operators adjusting to higher taxes may reduce their investment in sponsorships or other auxiliary racing activities. Industry observers also highlight risks such as possible growth in offshore, unregulated gambling, which could shift customers away from domestic channels.
No assurance exists that future Budgets will maintain current duty rates for horse racing, underscoring continued vigilance among stakeholders.
What Lies Ahead
Once enacted, the 2025 Budget will reshape the landscape for the UK gambling market. Online gambling operators and bettors outside the horse racing sphere face heavied fiscal pressure, a shift likely to influence business strategies and player experiences.
At the same time, the exemption secures near-term stability for racing, though the broader operating environment could subject the sector to new challenges. For now, the divide between taxed and untaxed betting activities sets the stage for winners and losers across Britain’s gambling industry, defining priorities and risks for the years to come.
- Author
Daniel Williams
