The Office for Budget Responsibility (OBR) has lowered its forecasts for betting and gaming receipts for year 2025-26 to £3.8bm, as part of its economic and fiscal report published today, 3 March.
This adjustment is £200m below the £4bn the UK government’s economic and fiscal watchdog announced alongside the Autumn Budget at the end of November.
Reflecting what the OBR said was “weaker-than-expected in-year receipts”, the revised figure of £3.8m, which equates to 0.1% of the country’s GDP, would represent a 4.1% increase on the previous year.
Back in November, the OBR anticipated a 9.8% gain year on year.
Long term, the OBR says it expects tax receipts to swell to £6bn (0.2% of GDP) in 2030-31, with two-thirds of this increase driven by tax hikes.
From this April, remote gaming duty is set to nearly double from 21% to 40%, while remote betting duty, excluding domestic horseracing, will jump from 15% to 25% as of April 2027.
Land-based betting and gaming were held at their current levels, while the 10% tax applied to bingo venues was abolished.
On paper, the government is projected to collect an additional £1.6bn from operators in 2027-28, when both remote gaming and sports betting tax hikes have kicked in.
Yet the OBR acknowledged last November that this figure could contract to a net yield of £1.1bn when accounting for behavioural responses as operators pass on the duty increases through less attractive slots RTP rates, for instance.
Modelling by analyst firm H2 Gambling Capital suggests “adverse behavioural change” will mean direct tax generation for state coffers will increase by only around £800m – a £300m shortfall compared to the OBR prediction.
While it might be natural to assume lower-than-expected 2025-26 receipts are largely down to black market leakage, analyst firm Regulus Partners told EGR it is more likely explained by weak betting margins in the final three months of 2025.
Nevertheless, the proliferating black market will be having an unknown impact on tax receipts as consumers turn to bookmakers on WhatsApp and sign up to offshore casinos, including those not part of self-exclusion programme GAMSTOP.
The government has recently established the Illegal Gambling Taskforce and provided the Gambling Commission with an additional £26m to tackle the threat of illegal operators.
Trade body the Betting and Gaming Council (BGC) has called the £26m “a drop in the ocean”.
A study the BGC commissioned EY to carry out last year suggested tax hikes could see more than £6bn in stakes diverted to the black market.
EY research produced on behalf of the BGC also forecast that nearly 17,000 jobs across the online and betting and gaming sector will be at risk because of increased taxation on remote operators.
Industry stakeholders EGR spoke to earlier this year suggested the industry had gone beyond the Laffer Curve – the correlation between tax rates and resulting revenue collection – and most were sceptical the Treasury will generate the additional tax it expects.
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The post OBR cuts betting and gaming receipts forecast by £200m for 2025-26 first appeared on EGR Intel.
Independent economic forecaster now anticipates the Treasury will collect £3.8bn, with one analyst suggesting shortfall likely to be caused by weak betting margins
The post OBR cuts betting and gaming receipts forecast by £200m for 2025-26 first appeared on EGR Intel.