BGC: Study Says Higher Taxes Weaken Regulated Gaming
Summary
PwC, for the UK Betting and Gaming Council (BGC), analysed several European online betting and gaming markets and found a strong link between high taxation/tight regulation and growth of the black market. Countries cited as outliers with high black-market shares include France (57%), Sweden (35%) and the Netherlands (37%), while more moderately taxed markets such as Spain and Denmark saw much smaller black markets (~11%).
The study also reports the UK’s offshore market share rose to 5% (from 3.3% in 2021), representing hundreds of millions of pounds in untaxed activity. PwC found markets with effective tax rates below 25% recorded stronger tax-receipt growth between 2019 and 2024 than higher-tax jurisdictions, attributing this to reduced operator marketing and competitiveness in high-tax areas that push customers to unregulated operators.
BGC chief executive Grainne Hurst warned that poorly calibrated tax rises could erode the UK’s generally safe regulated market, making it resemble France or Sweden, with larger black markets that do not contribute tax revenue or player protections.
Key Points
- PwC’s study links higher effective taxes and stricter rules to larger black-market shares in several European markets.
- France (57%), Sweden (35%) and the Netherlands (37%) are cited as having especially large black markets.
- Spain and Denmark — with more moderate taxation — have much smaller black markets (~11%).
- The UK’s offshore market share rose to 5% from 3.3% in 2021, equating to substantial untaxed activity.
- Between 2019–2024, markets with tax rates below 25% saw stronger growth in tax receipts than higher-tax jurisdictions.
- High taxes can shrink regulated operators’ marketing and promotions, reducing competitiveness and driving players to the black market.
- BGC argues that raising UK gaming taxes risks damaging the regulated market, reducing player protection and cutting funds for sport and the economy.
Context and relevance
This analysis arrives as the UK government considers changes to gambling taxation. It’s relevant for regulators, operators, industry lobbyists and policymakers weighing the trade-off between raising near-term tax revenue and preserving a competitive, well-regulated market that keeps players onshore.
The findings feed into ongoing debates about how to balance consumer protection, public revenues and the incentive structure for licensed operators. They also tie into wider European comparisons used by regulators when designing tax and licensing frameworks.
Author style
Punchy: this isn’t just another study — it’s a clear warning from PwC and the BGC that heavy-handed tax rises can backfire. If you work in regulation, industry finance or government policy, the implications matter for revenue forecasts, compliance strategy and player-safety outcomes. Read the detail if you want to avoid unintended consequences.
Why should I read this?
Quick and important: if you care about where tax revenue, player protections and industry health intersect, this piece saves you time. It explains why slapping higher taxes on gambling might actually shrink the regulated market and swell the black market — costing the state money and weakening safeguards. Worth a skim if you follow UK gambling policy or industry strategy.
Source
Source: https://www.gamblingnews.com/news/bgc-study-says-higher-taxes-weaken-regulated-gaming/