Gibraltar must remain pragmatic and prioritise smart policies to help domiciled businesses overcome the headwinds of a new UK tax regime on online gambling. 

This message led an address to Parliament by Nigel Feetham KC MP, the Minister of Trade and Industry of Gibraltar, providing an initial assessment of impacts that the Budget 2026 will have on the British overseas territory. 

Feetham made no bones on the significance of the increase in Remote Gaming Duty (RGD) from 21% to 40% on 1 April 2026 and General Betting Duty from 15% to 25% effective April 2027.: “This is an issue of vital importance to Gibraltar and one that may directly and indirectly affect our public revenues.”

Prior to the Autumn Statement, the Government of Gibraltar had warned the Chancellor of the Exchequer, Rachel Reeves, and the Labour government of economic consequences by lobbying and “setting out clearly to HM Treasury the potential local consequences of such a decision.”

Gibraltar’s big stake in UK betting

Gibraltar put forth its argument that gambling was no niche sector for its economy, but one that has been developed since the 1990s with domiciled businesses growing into world-leading players. 

Gambling licences contribution is easily viewed in the bottom-line of Gibraltar accounts as “ the online betting and gaming sector is a vital pillar of our economy. It accounts for approximately 30% of our GDP, employs more than 3,400 people, and generates around one-third of our tax receipts, through a combination of corporate income tax, personal income tax, social insurance and local gambling duties.”

The Minister warned that the new UK-imposed tax regime will immediately tighten margins for Gibraltar-based operators already paying substantial UK point-of-consumption duties, estimated at £750m annually.

Modelling by industry analysts suggests the effective tax rate on profits could climb from 60–65% to as high as 80–100%, severely constraining profitability and diminishing the level of corporate and PAYE tax Gibraltar receives locally.

Feetham stated that this development “risks undoing the progress achieved” through Gibraltar’s National Tax Strategy and could impact employment levels and business investment if operators are forced to restructure.

He further urged that gambling’s central role be factored into all future economic planning, emphasising that decisions on fiscal policy, diversification, and public spending “must consider the real and immediate impact on this cornerstone industry.”

Acknowledging the scale of the challenge, Feetham conceded that Gibraltar will need to adopt a ‘Plan B’ to adapt its online gambling strategy. While he warned that “no industry can replace gaming overnight,” he underlined the government’s intent to diversify exposure to the UK market and pursue growth in new international jurisdictions.

To this end, the Minister confirmed he had instructed the Gambling Commissioner to accelerate efforts to identify non-UK market opportunities, reinforcing Gibraltar’s position as a compliant, tech-driven hub for global gaming.

New Gambling Bill comes into focus 

Feetham stressed that consensus must now be reached across Parliament, regulators, and industry on a shared vision for Gibraltar’s next phase of development. This includes strengthening ties with the Financial Services Commission (FSC) and the Gibraltar Regulatory Authority (GRA) to modernise oversight and encourage innovation.

“We must remain united, confident, and pragmatic,” Feetham said. “By focusing on innovation, skills and smart regulation, we can broaden our economic base, generate new revenue streams and secure long-term prosperity.”

Feetham concluded his address by reaffirming that the forthcoming Gibraltar Gambling Bill will be central to the territory’s response. Designed to modernise regulation, encourage innovation and strengthen market resilience, the new framework will underpin Gibraltar’s strategy to remain competitive despite external fiscal pressures.

The Gibraltar Gambling Bill 2025 was formally published in June 2025 with the goal of upgrading the framework of 2005 Gaming Act, with new provisions to govern gambling licences and services with a modern, risk-based approach. 

The Bill will apply an expanded licensing criteria to cover key services and technologies from online gambling including customer care, support services, marketing, CRM, games suppliers, software providers, platform services, holding entities, and other key verticals. 

The new provisions of the Gambling Bill 2005 form part of a wider package of key reforms designed to meet FATF and MONEYVAL recommendations on transparency, deemed a necessary measure to in securing Gibraltar’s removal from the FATF grey list in 2024.

Closing the address  Feetham described the Bill as both a “continuation and evolution” of Gibraltar’s regulatory regime, a framework that must now adapt to protect jobs, revenues and reputation in an increasingly volatile international environment.

“This legislation will future-proof Gibraltar’s position as a trusted, well-regulated and forward-looking gaming jurisdiction,” Feetham told Parliament. “It will support the diversification of our markets, reinforce consumer protection, and ensure that Gibraltar continues to set the global standard for responsibility and integrity in gaming.”