Rachel Reeves has confirmed that online gambling will face a higher tax rate from April, in a move expected to raise more than £1billion a year for public services.
The Chancellor’s decision, set out in the Budget and now formally confirmed by the Treasury, will see duties on online betting and gaming increased while protecting horse racing and bingo halls from higher taxes.
HMRC said the move was driven by the rapid growth of online gambling and the damage it can cause to families and communities.
“Online gambling and its profits have grown rapidly, increasing social harms to families and communities,” HMRC said.
“That’s why the government is increasing tax on online gaming from April 2026 to raise over £1 billion for public services, while protecting horseracing and bingo halls.
« The rate for remote gaming will increase from 21% to 40% from April 1 2026 and the rate for remote betting will see an increase from 15% to 25% from April 1 2027.
« There will be no tax changes for bets on UK horseracing or in person gambling, and we are also abolishing Bingo Duty from April 1 2026. »
The Treasury said: « We have sought to take a balanced approach with these reforms which form part of our ambition to create a fair, modern and sustainable tax system. »
The tax rise follows pressure from MPs on the Treasury Committee, which last year called for higher taxes on remote betting and online casino-style games to reflect the harm they cause.
In a report published in November, the committee rejected claims from the gambling industry that online betting does not lead to social problems, and urged the Treasury to act.
The Government has now confirmed it agrees with that assessment, saying the Chancellor chose to increase duties on online gambling as part of the 2025 Budget.
Dame Meg Hillier, chair of the Treasury Committee, welcomed the decision and said: “The decision by the Chancellor to use her Budget to increase taxes on online gambling is a victory for common sense.
“The Chancellor has made the right decision in agreeing with my Committee that the tax rate for remote betting, including highly addictive casino games, should reflect the harm it inflicts.”
The Treasury is required to respond formally to recommendations made by the Treasury Committee, and its response confirms the position set out in the Budget.
The higher tax will apply to online gambling only, leaving traditional forms such as horse racing and bingo unaffected, amid concerns about protecting those sectors from further financial pressure.
