The latest stats from the UK Gambling Commission (UKGC) don’t paint a pretty picture for betting shops, again pointing to a sector in decline regardless of forthcoming tax increases.

Operator data covering Q2 of the 2025/26 financial year (July-September 2025) showed a 5% year-over-year decline in retail betting to gross gaming yield (GGRY of £508m (£483.5m), with the total number of sports bets placed and spins played in British shops down 2% to 3.1 billion.

This data comes just 14 days ahead of the announcement of the Labour government’s Autumn Statement. Rachel Reeves, Chancellor of the Exchequer, is widely expected to announce an increase in betting taxes in some form.

Trade body the Betting and Gaming Council (BGC) and its members have warned that tax increases will have huge unintended economic consequences that will most likely be reflected in the high street.

Betfred warned that a worst case scenario could see the total closure of its 1,300 betting shops, while William Hill owner Evoke and Ladbrokes Coral owner Entain cautioned that hundreds of shops could close.

However, with Commission data showing a continuing decline in retail GGY, with data from the prior quarter also showing a 5% drop, many ponder whether the government knows that the writing’s on the wall for retail anyway?

On paper, it certainly seems that the sector is on its way out while online continues to dominate gambling participation.

Punting becomes a party battleground

The industry’s warnings over the burdens of heavier taxation, as well as those of horseracing, have constantly clashed against those of gambling law reform advocates and those who believe the industry should pay a higher share.

Gordon Brown, former Prime Minister and Britain’s longest serving Chancellor of the Exchequer, is one of the biggest proponents. His rationale that an increase in gaming taxes can be used to pay for cutting the two-child cap on child benefit payments, something it seems Reeves wants to do, has been endorsed by more than 100 Labour MPs.

Regarding tax proposals, on the lighter end is the subject of HM Treasury’s initial proposal, a harmonisation of General Betting Duty (15%), Pool Betting Duty (15%) and Remote Gaming Duty (21%) to one single 21% rate.

At the more extreme end, and the one keeping online operators and slot operators awake at night, is a proposal for RGD to rise 50%, Machine Games Duty (MGD) on slot machines from 20% to 50% and GBD to double from 15% to 30%. It has also been suggested that MGD could rise only to 40%.

Labour is hardly an anti-gambling party, having drafted and implemented the 2005 Gambling Act during Tony Blair’s tenure as PM. It is, however, a party with a lot of MPs who have concerns about the impact of gambling on underprivileged communities, while the Labour government faces the challenge of raising billions in public spending – and as a former Conservative Prime Minister once notoriously put it, “there’s no such thing as a magic money tree.”

On the other side of the political aisle, the Conservatives seem to have been allying more with horse racing, as part of a wider appeal to rural constituencies, – though party grandees such as Ian Duncan Smith remain staunch advocates of gambling reform.

Gambling developments are closely followed by Reform UK, as another opportunity to grab media spotlight for the populist party. Nigel Farage, leader of the party and MP for the Essex seaside town of Clacton, has already put his political weight behind the amusements industry, and this week expanded his support to include betting shops.

“What I would say about the high street is that one of the things that does still survive is the bookmaker shop – which actually, for a lot of lonely people, is a place they can go in and meet people,” he said at a Reform UK press conference covering its policies for small businesses this week.

“There are 22 million people a week who have a bet of some kind in this country. Yes, there are a few problem gamblers, but there are problem drinkers, there are problem drug takers, there are problem everythings.

“I worry that if she (Rachel Reeves) puts up Gaming Duty significantly in this budget, not only will it close hundreds, maybe thousands of high street bookmakers, but I genuinely wonder whether Clacton Pier and the other 400 Seaside villages and towns, my worry is that it will close all those down too.”

Retail getting routed by online…

Politics aside, returning to the Gambling Commission’s stats for Q2 2025/26, it is plain that online gambling is solidifying its position as Britain’s most popular form of betting – having earned this spot at the expense of dwindling retail some time ago.

Online GGY was £1.42bn, an increase of 8% from Q2 2024/25, and demonstrating a larger growth rate than the 2% seen in Q1 2025/26. Total bets and spins rose 3% to 26.1 billion, although active account numbers did drop 7% to 12 million.

This may have also been driven by the return of Premier League and Champions League football during Q2. This impact can also be seen in the rise in real event betting, which rose 12% to £508m despite the number of bets dropping 3% and the number of active accounts for real event betting dropping 14%.

Also, despite stake limits on online slots having been in effect for five months by the end of the reporting period – £5 for all adults and £2 for those aged between 18-24 – slots GGY actually rose 9% YoY to £747m.

…but will this cost political points?

Similar to other reported verticals, the average number of active slot accounts dropped during the quarter, though only by a small 0.4%, while the number of online sessions lasting an more than an hour dropped 15% to 8.6 million – a win for the industry’s player protection and responsible gaming teams, at least.

However, the fact that slots and online gaming GGY has gone up may not help the industry’s case in the tax debate. Despite all the talk around retail betting and the high street, think tanks and campaigners like the Social Market Foundation (SMF), Institute for Public Policy Research (IPPR) and Gordon Brown aren’t that bothered about retail betting.

The real target of tax advocates is online gambling – and the fact that gaming GGY, although not the same as revenue, continues to rise for digital platforms may make it all the the logical for a Labour government in dire need to sort out public finances to increase the rates.