UK think tank reiterates call for gambling tax hike, says black market ‘unlikely to be a major threat’

Summary

The Institute for Public Policy Research (IPPR) has repeated its call for substantially higher gambling taxes in the UK, arguing the sector could be made to pay more to help fund social measures such as scrapping the two‑child limit and the benefit cap. The think tank proposes raising remote gaming duty from 21% to 50%, machine games duty from 20% to 50% of operator profit, and general betting duty from 15% to 25%.

The IPPR estimates these changes could generate more than £3 billion a year, with an additional £1.8 billion projected for 2026–27, and said fears over a large-scale shift to the illegal market are overstated. The gambling industry and the Betting and Gaming Council (BGC) strongly reject the proposals, warning of job losses, harm to horse racing and a growth in the black market. The debate arrives as the UK prepares for an autumn budget where tax rises are widely expected.

Source

Source: https://igamingbusiness.com/finance/uk-think-tank-gambling-tax-hike-black-market-no-threat/

Key Points

• IPPR recommends remote gaming duty rise from 21% to 50%, machine games duty from 20% to 50%, and general betting duty from 15% to 25%.
• The think tank estimates the changes could raise over £3bn per year and an additional £1.8bn in 2026–27; machine games and betting duty increases could yield ~£880m and ~£450m respectively.
• IPPR argues extra revenue could be used to remove the two‑child limit and lift the benefit cap, targeting child poverty.
• IPPR says the black market is “unlikely to be a major threat” from tax rate changes, contesting industry warnings.
• The industry and BGC counter the proposals as “economically reckless”, warning of migration to unregulated offshore sites, job losses and harm to horse racing.
• Examples from the Netherlands and Germany suggest tax hikes can weaken channelisation and reduce GGR, according to sector stakeholders.
• Former PM Gordon Brown backs the IPPR plan, saying it could lift half a million children out of poverty if adopted in the autumn budget.

Why should I read this?

Because this is one of those small-but-not-small policy fights that could actually move money around the country — and fast. If the IPPR gets traction, billions could be redirected from operators to social support, regulations and political rows will intensify, and the industry’s business model would be under fresh pressure. Read it to know who gains, who loses, and why the black‑market argument is the headline battleground.

Context and Relevance

The story sits at the intersection of public finances, social policy and gambling regulation. With the UK facing pressure to raise revenues ahead of the autumn budget, the proposal feeds into wider debates about taxation fairness, offshore operator tax avoidance, and consumer protection. For operators, regulators, investors and social policy groups, the IPPR paper signals a potential shift in how gambling is taxed and politically framed in the UK.