MPs Press Rachel Reeves to Hike Gambling Taxes

Published: 07 November 2025. The English Chronicle Desk. The English Chronicle Online.

MPs on the Treasury select committee have called on Chancellor Rachel Reeves to raise taxes on the UK’s £11bn gambling sector, urging her to ignore what they describe as “scaremongering” by betting firms determined to protect their profits. The committee’s report, released as the Treasury finalises Reeves’s second budget, delivers one of the most direct challenges yet to the industry’s influence in Westminster and to its efforts to stave off reform.

The MPs accused gambling firms of hiding their most addictive and socially harmful products behind the façade of traditional pastimes such as horse racing and seaside arcades. They called on the chancellor to focus tax rises on high-risk areas, including online casino games and high-street slot machines, both of which have seen significant growth in recent years.

The committee’s recommendations echo similar calls from policy groups and former Prime Minister Gordon Brown, who earlier this year proposed a £3bn tax increase on the industry to fund the removal of the controversial two-child benefit limit. Although Reeves’s final decision remains unknown, Treasury insiders have hinted that the chancellor may favour a more moderate increase — potentially raising between £1bn and £1.5bn — to balance fiscal gain with political caution.

In an unusually sharp rebuke, the committee also criticised the industry’s leading lobbying group, the Betting & Gaming Council (BGC), for what it described as a “staggering” denial of gambling-related harm. During a tense evidence session, BGC chief executive Grainne Hurst insisted there was “no proven link” between gambling and social harm — a statement that drew audible disbelief from MPs.

Committee chair Meg Hillier later described the exchange as “an extraordinary moment” in Parliament. “You feel a moment in a room sometimes where everyone’s jaw drops,” she said. “A couple of us pushed to ask if she was sure she was saying that. But she doubled down.”

The report, published just a week after the hearing, argues that gambling taxation should reflect the relative risk of each activity, linking fiscal policy directly to public health outcomes. “If gambling is causing harm, that harm must be recognised and mitigated through the way it is taxed,” the MPs wrote.

Currently, the gambling industry operates under a patchwork of tax rates. Bets on horse racing and sports fall under a general betting duty of 15%, the same rate as pool betting. Traditional casinos pay gaming duty on a sliding scale between 15% and 50%, while remote gaming — which includes online casinos and slot-style games — is taxed at 21%. High-street slot machines, regulated under machine gaming duty, are taxed at 20%.

The Treasury has reportedly been considering a harmonised tax structure to simplify these rates. However, both the Social Market Foundation (SMF) and the Institute for Public Policy Research (IPPR) — two respected thinktanks — have warned that uniform taxation could unfairly benefit the most harmful parts of the industry by lowering their relative tax burden. The select committee has now joined their call for the chancellor to resist harmonisation and instead apply higher rates to the products most associated with addiction.

The BGC, representing major operators such as Bet365, Ladbrokes, and Betfred, has argued fiercely against any tax increase. The group claims that higher taxes would force companies to pass costs onto customers through poorer odds and less generous promotions, potentially driving gamblers towards unregulated offshore sites.

Yet, the committee’s report disputes those claims, citing international data suggesting that modest tax rises do not meaningfully increase black-market activity. It also challenges the notion that tighter regulation automatically leads to economic harm, pointing to evidence from other countries where gambling reforms have been implemented without major job losses or reductions in tax receipts.

The industry, however, continues to warn of dire consequences. A report commissioned by the BGC from the accounting firm EY predicts that as many as 40,000 jobs could be lost if taxes rise too sharply, with a £3.1bn impact on the economy. Betfred — owned by billionaire and former Conservative donor Fred Done — has even threatened to close all of its 1,287 UK betting shops if faced with a major tax hike.

A BGC spokesperson reiterated the industry’s concerns in a statement following the committee’s report, saying, “A tax raid on the sector would end up reducing Treasury revenues and cutting the vital funding our members provide to British sport, including horseracing, football, rugby league, darts, and snooker.”

Nevertheless, MPs remain unconvinced by such warnings. They argue that the industry’s reliance on the threat of job losses and reduced funding for sports is a tactic long used to resist necessary change. “The Treasury should not be intimidated by exaggerated claims,” one committee member said privately. “The evidence shows this is a wealthy and resilient industry, and a fairer tax system is overdue.”

As the chancellor prepares her next budget, due to be unveiled early next year, the issue is expected to become one of the most politically charged debates within economic policy. Reeves, who has so far balanced fiscal responsibility with a cautious approach to industry regulation, faces competing pressures — from social campaigners calling for stronger safeguards and from powerful betting firms warning of economic fallout.

What is clear, however, is that the political tide has shifted. Public awareness of gambling addiction and its social costs has grown sharply in recent years, fuelled by investigative reporting, parliamentary inquiries, and high-profile personal stories. The committee’s report reflects that mood, calling for a fiscal framework that places social responsibility above profit.

For now, the gambling industry remains defiant. But the message from Westminster is equally firm: the days of light-touch regulation and lenient taxation may soon be coming to an end.