BGC warns UK gaming tax increases are a black market 'jackpot'
The decision to raise the UK’s Remote Gaming Duty to 40 per cent, which came into place in April 2026, “is set to accelerate the shift towards illegal operators,” warned the Betting and Gaming Council (BGC), as it cited independent analysis and research conducted by H2 Gambling Capital. The BGC described the UK gaming tax increases as a “jackpot” for illegal bookmakers.
Gambling black market expected to make gains as the regulated market wanes
H2, through its analysis, concluded that the Remote Gaming Duty increase, in combination with lower onshore RTP, is expected to result in more customers moving away from Britain’s regulated betting industry.
With the Remote Betting Duty set to increase further from April 2027, a year after the initial hike, H2’s report indicates that additional UK gaming tax hikes will result in more pressure being placed on licensed operators.
“The shift is already underway,” the BGC commented. “Offshore online gambling turnover has surged from £5 billion in 2019 to £16.9 billion today and is forecast to more than double again to £36 billion by 2031.”
The BGC, referring to the report, said that it forecasts how the illegal market’s share of online betting is expected to more than double, from 10 per cent in 2025 to 22 per cent by 2031, “as the proportion taking place with licensed operators falls from 90 per cent to 78 per cent”.
It remarked that this means more than one in every five pounds staked online could end up with offshore operators instead of Britain’s regulated market. It added that such findings underline the importance of ensuring that Britain’s regulated betting and gaming market remains competitive, “so customers continue to choose licensed operators offering robust consumer protections rather than illegal sites”.
UK gaming tax hikes give an advantage to illegal operators, warns the BGC
The Chief Executive of the BGC, Grainne Hurst, commented that the UK gaming tax hikes are giving illegal gambling operators a competitive advantage over the regulated market.
“Britain has one of the world’s leading regulated betting industries, supporting more than 109,000 jobs, generating £4b billion in tax every year and funding some of our most-loved sports,” Hurst remarked, as she continued that “if ministers keep making the regulated sector less competitive, customers won’t stop betting”.
She warned that rather than stop betting, customers would simply take their money elsewhere, namely to the growing illegal black market, “where there are no safer gambling protections, no age verifications, and no taxes paid to the Treasury”.
“The only winners from the tax hikes,” Hurst remarked, “will be criminal operators based overseas.” She said that jobs in Britain, as well as investment and tax revenue, will be lost, and that consumers will continue being pushed towards illicit operators in the meantime.
Referring back to the H2 report, Hurst said that it forecasts that illegal gambling revenues will more than double from £685 million in 2025 up to £1.4 billion by 2031, growing at a rate of almost 13 per cent a year, “while Britain’s regulated online market is forecast to grow by just 0.2 per cent annually and shrink by 12 per cent in real terms over the same period”.
Higher taxes, the BGC warned, are ultimately handing an increasing competitive advantage to illegal operators, “threatening the £4 billion in annual tax revenues, 109,000 jobs and millions of pounds in funding for British sport generated by Britain’s world-leading regulated betting and gaming industry”.
New UK Treasury Head
Rachel Reeves’ tenure as Chancellor of the Exchequer, or as head of the UK Treasury, ended on 20 July as incumbent Prime Minister Andy Burnham appointed a new cabinet. Reeves was a supporter of the tax hikes and was a driving force behind their implementation. Reeves’ successor is John Healey.
The BGC commented that it looks forward to working constructively with the new Chancellor and his colleagues in the UK Treasury, as it commented that the new government “inherits a sector that has been significantly weakened by recent tax increases, which have cost jobs, undermined investment and competitiveness while strengthening the illegal gambling market”.
It concluded that it hopes to work with the Chancellor of the Exchequer and the Treasury in order to “restore a stable, internationally competitive tax and regulatory environment that supports jobs, protects consumers, and delivers sustainable revenues for the Treasury”.
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