gambling tax

The UK government has confirmed a significant shake-up of gambling taxation, with substantial increases aimed squarely at the online sector. Announced in the Autumn Budget, the measures are designed to modernise the tax system, reflect the rapid growth of digital gambling, and raise much-needed revenue for the public purse.

Below is a clear breakdown of what's changing, when it will happen, and what it means, especially for online casinos.

What Was Announced in the Autumn Budget?

In the Autumn Budget, the Chancellor outlined plans to increase taxes on certain forms of remote gambling, citing the sector's strong profitability and continued expansion. The government argued that the existing tax framework no longer reflects how consumers gamble today, with online platforms now dominating the market.

The reforms focus on online gaming and remote betting, while deliberately leaving traditional gambling activities untouched.

Online Gaming Tax: Rising to 40% in 2026

The most dramatic change affects online gaming, which includes online casino games such as slots, roulette, blackjack, and live dealer products.

Current rate: 21%

New rate: 40%

Effective date: 1 April 2026

This near-doubling of the tax rate represents one of the largest increases the sector has ever seen. Online casinos will be required to pay the higher rate on their gross gaming yield, significantly increasing operating costs.

Remote Betting Tax Increase in 2027

A separate increase applies to remote (online) betting, which covers sports betting placed online, including football betting apps and websites.

Current rate: 15%

New rate: 25%

Effective date: April 2027

By staggering the changes, the government aims to give betting operators more time to adjust their business models and pricing structures before the higher rate takes effect.

What Is Not Changing?

Importantly, the government has chosen not to raise taxes on several traditional gambling sectors: Horse racing betting remains taxed at its current rate.

Land-based betting shops and retail bookmakers will see no change to their tax treatment. This distinction reflects concerns about the health of high streets, employment in physical venues, and the long-standing relationship between horse racing and betting revenues.

How Much Will These Measures Raise?

According to Treasury estimates, the new gambling tax regime is expected to generate around £1 billion for the public purse over the coming years.

The government has suggested the additional revenue will help fund public services and contribute to broader fiscal repair efforts, while also aligning gambling taxation more closely with public health and regulatory objectives.

The Impact on Online Casinos

Online sites like King Casino are likely to feel the sharpest impact from these changes. A 40% tax rate will significantly reduce profit margins, particularly for smaller or mid-sized operators. This could lead to reduced bonuses and promotions, tighter betting limits or game availability and consolidation in the market, as smaller operators struggle to compete.

Potential Changes for Players

While operators absorb much of the cost, some impact may filter down to players through less generous welcome offers, fewer ongoing rewards, reduced VIP incentives and more cautious risk management by platforms.

Increased Focus on Compliance

With higher taxes and tighter regulations, online casinos are expected to double down on compliance, responsible gambling tools, and operational efficiency to justify continued operation in the UK market.

A Clear Shift Toward Digital Gambling Reform

Taken together, these tax increases signal a clear policy direction: the UK government is placing greater financial responsibility on the online gambling sector, which has grown rapidly over the past decade.

While traditional betting and horse racing remain protected for now, online casinos and remote betting operators face a future of higher costs, tighter margins, and increased scrutiny.

The key dates to watch are 1 April 2026 for online gaming tax changes and April 2027 for remote betting, milestones that will reshape the UK's online gambling landscape for years to come.