The odds of Rachel Reeves, Britain’s Chancellor of the Exchequer, raising betting tax in some way or another in next month’s autumn budget now weigh considerably against the industry.

Reeves and PM Keir Starmer have a big financial undertaking to complete, needing to raise billions of pounds for their various public investment projects. On top of this, they are facing calls from many of their own MPs to cut the two child benefit cap, which proponents believe can be paid for via gambling revenue.

The betting industry is understandably concerned about this, with prospective tax raises coming shortly after Q2 revenue reports and ahead of Q3 earnings calls, which will be unveiled throughout November by the majority of gambling PLCs.

Stella David, in her first interview with UK media since becoming CEO of Ladbrokes and Coral parent company Entain on 30 April after serving as interim CEO since February, projected that betting tax raises could spell trouble for Britain’s retail betting scene.

Speaking to The Times, David said that the company would have to evaluate shop closures ‘depending on the level of where the increases were’ – suggesting that betting shops could be hit hard depending what verticals the betting tax raises could target.

The scale and scope of a prospective betting tax rise is anyone’s guess. For the past few months, a lot of discourse has focused on a potential merger of the three types of gambling duty – remote gaming duty of 21%, pool betting duty of 15% and general betting duty of 15%.

This has prompted particularly fierce criticism from horse racing with the British Horseracing Authority (BHA) calling a strike in September. This was criticised heavily by the Betting and Gaming Council (BGC), suggesting a difference of opinion between betting operators and horse racing despite their shared opposition to tax raises.

Shutters up on betting shops

Betting shops are a familiar site across British high streets with there being 5,931 throughout the country according to the latest data from Statista. While extensive, this is still a considerable drop from previous years, with UK Gambling Commission (UKGC) stats from November 2022 showing 6,219 shops.

The COVID-19 pandemic dealt a particularly heavy blow to retail betting as lockdowns forced the closure of all shops, many of which did not reopen when the rest of society did in 2021.

The aforementioned Commission’s stats show that the number of betting shops fell by 19.1% from the month the UK’s pandemic lockdowns began, March 2020, and the publication of its November 2022 data. This figure has continued to shrink.

According to more recent Commission figures, the number of people participating in online betting stands at 38% while in-person gambling is at 29%. While this may not seem like much of a difference, lottery ticket sales account for a huge proposition of this 29%.

When combined with gross gambling yield (GGY) stats for the first quarter of the 2025/26 financial year, published in August, retail betting GGY dropped 5% to £552m while online GGY was up 2% to £1.49bn.

Entain’s CEO seems to be implying that should general betting duty rise by six percentage points to match that of remote gaming duty, this could be yet another nail in the coffin for British retail betting.

Intended and unintended consequences

For many, this wouldn’t exactly be a bad thing. Some 39 local authorities and a growing number of MPs have been calling for local governments to get more powers to prevent gaming premises from setting up in their areas.

This is motivated by a concern that betting venues are disproportionately located in low income areas, areas where the Gambling Survey for Great Britain (GSGB) shows people with gambling disorders are likely to live.

David seems to have taken on board the poor publicity the industry gets in her Times interview, though also reiterating the industry’s counter-argument that over-regulation and over-taxation could push customers to a black market – one which Gamstop data shows nearly a tenth of self-excluded bettors use.

“I don’t expect anyone on the street to feel sorry for us at all, that’s not their job, but a normal person on the street who likes to have a bet can’t tell the difference between a black market site and a regulated site,” David told The Times.

All the evidence suggests that a betting tax hike is on the way, with Reeves herself stating that gambling firms could stand to pay more. The exact nature of these hikes is still uncertain, but regardless it seems Entain expects its portfolio of some 2,300 Ladbrokes and Coral betting shops to be hit hard.

Outside of the black market, this could have one more unintended consequence, that being an impact on player protection.

Though hardly immune to problem gambling, retail venues do have the option of easier in-person interactions and closing hours that prevent customers from betting throughout the night and/or while under the influence that online cannot guarantee.

What is for certain is that the government has more than just finances to consider when deciding how to tax betting. It has wider macroeconomic factors as well as consumer protection ones to consider as well – as always, nothing is black and white.