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The UK confirmed a substantial rise in remote gaming duty, prompting immediate warnings from major operators as digital gambling faces one of its steepest cost increases to date.
The UK government will lift the online casino tax rate from 21% to 40% from next April, reshaping the financial landscape for digital operators. The change, announced as part of the Chancellor’s latest budget, introduces a significantly higher cost base for remote gaming while leaving land-based venues and high-street betting shops unaffected. The update marks one of the most far-reaching tax changes applied to UK-facing online operators in recent years.
Operators respond with revised forecasts
Evoke, Entain and Flutter outlined significant cost pressures and updated guidance following the announcement.
The higher rate triggered sharp market reactions. Evoke, the owner of William Hill and 888, said the revised duty will add GBP 125 million to GBP 135 million in annual tax costs. The company lowered its medium-term expectations and confirmed plans to reduce UK investment, with job cuts now under consideration as part of cost management initiatives.
Entain projected a GBP 100 million impact in 2026 and up to GBP 150 million from 2027 once the wider digital tax package takes effect. The group said higher costs will limit promotional activity and reduce customer incentives, with concerns emerging that the new conditions may push more players toward offshore markets outside UK oversight.
Flutter highlights long-term competitiveness risk
The group expects profit reductions and plans spending adjustments across its UK portfolio.
Flutter, whose brands include Paddy Power, Betfair and Sky Bet, forecast a multi-year profitability impact. The company plans to reallocate marketing spend and streamline operations to moderate some of the financial pressure. However, Flutter said the updated structure could reduce the UK’s competitiveness against offshore operators that are not subject to the same tax obligations.
Industry split as some sectors avoid higher duties
Bingo halls and horse racing secured favourable outcomes as the new package divides stakeholder reactions.
Bingo halls will no longer pay the 10% bingo duty, while the horse-racing sector avoided the increase to general betting duty that had been under discussion. Racing bodies welcomed the decision but acknowledged that if bookmakers reduce spending, the downstream impact could still be felt within the sport.
Supporters of the higher duty argue that digital slot and casino products carry greater social risks and therefore warrant stricter financial control. Industry groups counter that the scale of the increase limits operator flexibility, restricts safer gambling investment, and places added pressure on mid-sized companies already adjusting to tighter regulatory oversight.
Wider tax context and link to earlier reporting
The update follows earlier sector discussions around rising operator obligations.
The government expects the new duty structure to generate more than GBP 1 billion annually by the end of the decade, driven by sustained digital gambling activity and the increased rate applied to online casino products. From 2027, digital sports betting will also move to a 25% tax rate.
Earlier reporting on projected changes in the UK’s tax framework, including the shift to a 40% duty rate. While this article examined scenarios raised through early fiscal documents, the government’s latest announcement confirms the full scope and timing of the official policy change.
Sector prepares for a new operating baseline
The adjustment marks a structural shift that operators must now incorporate into long-term planning.
The confirmed rise sets a new cost baseline for UK-facing online operators, with changes expected across marketing, product portfolios, margins and safer gambling investment models. For suppliers, investors and operators, the new duty rate signals a more demanding financial environment and introduces another round of strategic reassessment as the industry enters 2026.
Source: Gambling News
