Almost a year ago, then-Chancellor Rachel Reeves announced a significant increase in remote gaming duty (RGD) during her Autumn Budget, raising it from 21% to 40%. This change, which took effect on April 1, 2023, sent ripples across the UK gambling landscape, leading to notable declines in retail operations, job cuts by major operators, and a consolidation of market share among the largest players.
As stakeholders prepare for the upcoming Budget on Wednesday from new Chancellor John Healey, the industry braces for a possible increase in machine games duty (MGD). The key question remains: How has the sector evolved since the RGD hike was announced?
The repercussions of this tax increase are becoming clear. The RGD hike was accompanied by a new betting duty rate for remote gambling, which will rise to 25% in April 2027 from the previous rate of 15%. Grainne Hurst, CEO of the Betting and Gaming Council, labeled the tax hike as “excessive” and cautioned it could deliver a “devastating hammer blow” to the industry.
Prior to the RGD increase, data from the Gambling Commission indicated that as of March 31, 2026, the UK had 2,154 licensed gambling operators. This marks a 1.1% decrease from the previous year, although it is noteworthy that the total had declined annually from 2017 to 2025, making this reduction an improvement in the context of the preceding trend.
Interestingly, the industry's overall performance has not been entirely adverse; total gross gambling yield (GGY) increased by 4.4% to £17.5 billion, bolstered by a 6.9% surge in online casino, betting, and bingo sectors. Ed Birkin, Managing Director at H2 Gambling Capital, believes that the full effects of RGD have not yet surfaced and asserted that operators continue to vie for market share despite elevated tax obligations. "I don’t think it’s having a material impact yet," he commented regarding the effects on gross gaming revenue (GGR).
However, since the new RGD rate was implemented, major UK operators have started making significant cuts. Flutter Entertainment announced a restructuring effort that could eliminate as many as 1,400 jobs in the UK and Ireland. Similarly, Evoke has closed around 200 William Hill shops, while Betfred plans to shutter up to 132 locations, impacting over 600 employees. Bet365 also disclosed plans to reduce its workforce by approximately 340 positions, demonstrating the stringent cost-control measures operators must employ.
The wave of job losses and store closures has fueled concerns regarding a wider contraction in the regulated gambling sector. CEO of Gambling Consultant, Steve Donoghue, has warned that Flutter's job cuts may not be isolated incidents. He predicts that the industry could experience dramatic declines, potentially losing “thousands” of jobs. Furthermore, he cautioned that the increased taxes could push consumers toward unlicensed operators, exposing them to greater risks and diminishing consumer protections.
Donoghue attributed the discussions surrounding tax hikes to political motivations, suggesting a resurgence of “populist left-wing puritanism.”
The effects of the RGD increase, while primarily targeting online gambling, have led many operators to seek savings from retail sectors. As a result, the number of gambling premises in Great Britain saw a 2% decline to 8,081 between April 2025 and March 2026, coupled with a 3.3% decrease in retail GGY to £2.4 billion.
The situation may worsen for retail betting as Healey's Autumn Budget approaches. A faction of Labour MPs has already reached out to him, advocating for an increase in MGD, which currently sits at 20%. Observers anticipate that this duty will rise, though the extent of the increase remains uncertain. The Social Market Foundation has proposed a double of this rate to 40%, while others predict a more modest adjustment of around 5%.
Greg Knight, CEO and owner of Jenningsbet, warned in The Times that a doubling of MGD could shutter around 100 shops, while Fred Done, owner of Betfred, foresees complete retail betting closure by 2030. The Betting and Gaming Council highlighted that an increase in MGD to 40% could eliminate nearly 1,500 betting shops, 34 casinos, and result in the loss of 16,000 jobs.
Despite the struggles in retail, larger operators appear more resilient amid the shifting tax environment. For example, Entain's Q3 results showed a 14% year-over-year growth in online net revenue for the UK and Ireland. CEO Stella David indicated that the company is in a strong position to deal with potential MGD hikes, suggesting they could emerge as relative winners in retail.
Even while announcing significant job cuts, Flutter's UK and Ireland CEO Kevin Harrington expressed confidence that their size will help them gain market share. Richard Clarke, managing director at Flutter's brands Paddy Power and Betfair, also emphasized the advantages larger companies have in adapting to tax changes, predicting they would capitalize on the situation.
As the gambling industry continues to adapt to the repercussions of the RGD hike, the Budget's outcomes could set the stage for another wave of adjustments. With the potential for further taxation looming, operators are left awaiting an uncertain future.
