The Department for Culture, Media and Sport (DCMS) has confirmed a 25% increase in Gambling Commission licence fees, set to start on 1 October 2026. This announcement, made on Tuesday, represents a shift from three earlier proposals discussed in a public consultation conducted between 27 January and 30 March. The consultation, which received 47 responses primarily from gambling operators and industry representatives, informed the decision to implement a straightforward 25% fee hike across most licence categories, though a few sectors, like society lotteries, will see their fees remain unchanged.
DCMS explained that the fee increase is intended to address funding gaps and reinforce enforcement efforts against illegal operators. This comes in the wake of significant tax increases imposed on the sector just months earlier, which have already raised operational costs.
Initial proposals included fee hikes of 20% and 30%, as well as an additional 10% designated for combating illegal gambling. However, after considerable pushback from industry stakeholders, DCMS decided on a universal 25% increase covering various fees, including operating licences, application fees, personal licences, and corporate control changes. The first annual fees will continue at 75% of the full annual rate, while increased fees for supplementary operating licences and single machine permits will also rise by 25%.
It is notable that society lotteries, which contribute to charitable causes, will not face any fee increases to ensure funds are preserved. Changes for on-course bookmakers involve shifting from a fee structure based on operating days to a model based on market share, calculated by gross gambling yield (GGY). This adjustment is expected to benefit 44% of operators in this category by lowering their fees, while 53% will see only slight increases, averaging around £22.
DCMS also dismissed the Gambling Commission's proposal to reserve some fees specifically for tackling the illegal gambling market. Instead, the Commission will continue its anti-illegal gambling strategy with support from a £26 million funding commitment from HM Treasury over the next three years. Both DCMS and the Gambling Commission stated that the fee increase is crucial for maintaining regulatory functions, as the regulator faces a yearly budget shortfall of approximately £4 million. Even with the planned fee rise, an additional £8 million in efficiency savings will be needed over the next five years.
The DCMS reiterated that licence fees are structured on a cost-recovery model to cover the Commission’s operational expenses, with revisions made according to operator activity or market share. For instance, large operators generating over £100 million in annual GGY will see fees rise from around 0.1% to about 0.15% of GGY, with annual fees for larger remote and non-remote operators potentially exceeding six figures.
Feedback from the industry largely opposed the fee increases, with concerns about the compounded financial impacts of recent duty changes and a new statutory levy. Bethan Lloyd, a senior associate at Wiggin LLP, commented on the situation, suggesting the additional burden “isn't going to be the straw that breaks the camel’s back.”
These changes will be formalized through secondary legislation and take effect on 1 October 2026.
