MPs warn gambling tax rises will fuel harmful illegal black market

MPs from across the political spectrum have warned that the Government’s planned increases to gambling duties risk accelerating the growth of the illegal online gambling market, undermining Treasury revenues and putting thousands of jobs at risk.

During a House of Commons debate on the Finance Bill —which proposes a near‑doubling of online gambling taxes—MPs raised concerns that higher duties will weaken the regulated sector while pushing consumers towards unlicensed operators offering no safeguards or tax contributions.

The Betting and Gaming Council (BGC) has repeatedly cautioned that the tax rises announced in the Budget will lead to job losses across retail and online businesses, reduced high‑street investment, and a shift in customers towards the black market, where there are no consumer protections or safer gambling measures.

James Wild MP, Shadow Exchequer Secretary to the Treasury, warned of the unintended consequences of excessive tax increases.

“When taxes rise too far, behaviour can change and the yield can go down,” he said. “Rather than reducing demand, activity will move to unregulated markets where consumer protections are weaker, fraud risks are higher, and tax revenue is not collected.”

Treasury documents acknowledge the risk, forecasting a £500 million rise in unlicensed gambling activity. Just £26 million has been allocated to counter this—an amount MPs described as wholly inadequate given the scale of the threat.

Independent modelling by EY suggests the Remote Gaming Duty rise alone could cost nearly 15,000 high‑tech jobs and divert more than £4 billion in stakes to unlicensed operators. Higher sports betting duties could push a further £2 billion offshore and result in an additional 1,750 job losses. In total, almost 17,000 jobs and more than £6 billion in stakes are at risk of being displaced to the black market.

Labour MP Gareth Snell highlighted similar warnings from the Office for Budget Responsibility.

“The OBR states that there will be a drive towards the black market as a result of these taxation changes,” he said. “That is much more damaging, will raise much less revenue and, ultimately, will be much more damaging to our economy.”

MPs also raised concerns about the impact on charities and good causes, warning that many face a “funding cliff edge” as the statutory levy transitions to NHS oversight. They stressed the need to ensure that changes to gambling taxation do not inadvertently destabilise vital funding streams for organisations delivering gambling harm prevention and support services.

Caroline Dinenage MP, Chair of the Culture, Media and Sport Committee, said she had received “very concerning reports” from voluntary organisations facing uncertainty and delays around levy funding. She urged ministers to ensure no charity is forced to close due to the transition.

BGC Chief Executive Grainne Hurst said MPs were right to highlight the real‑world consequences of further tax rises.

“These increases will result in job losses, shop closures and will drive customers towards the unsafe and harmful black market.

“The regulated industry supports 109,000 jobs, contributes £4 billion in tax and funds sport, charities and safer gambling. Undermining it hands a gift to illegal operators who pay no tax and offer no protections.”

Hurst urged the Government to adopt an evidence‑led approach that protects jobs, supports growth, safeguards charitable funding and avoids strengthening the illegal market.