UK Gambling Sector Remains Healthy Despite Increased Taxes

A recent analysis by Regulus revealed that the UK’s leading gambling operators appear to have adapted to the recent tax hike without shifting much of the extra burden to customers. Despite these outward signs of stability, analysts remain cautious, maintaining a bearish outlook for the market and expecting a 12% decline in 2027. Market Leaders Have Largely Adapted With the UK’s Autumn 2025 budget raising the remote gaming duty from 21% to 40%, many operators feared they would be forced to pass these additional costs to consumers, leading more users to migrate to black-market alternatives. However, a recent report by Regulus reveals that this might not necessarily be the case, as the UK’s leading operators have generally performed well in Q2. According to Regulus’ analysis, the UK’s six largest gambling companies, which account for roughly 66% of the market, posted modest Q2 growth. Notably, the tax raise did not have a discernible effect on the reported financial results. However, analysts were not ready to dismiss the hike as inconsequential. They still expect the market to shrink in the following months. The steady Q2 results were mostly attributed to bettors sticking to their betting patterns, since most operators opted not to change their bonusing levels, instead slashing other expenses. The World Cup was especially beneficial to companies like Entain and Super Group, while iGaming revenue recorded modest growth. The true test will be H2, which does not contain any high-profile events that could skew results. The Tax Hike Has Not Been Without Consequences While the Regulus report focused on the UK’s top gambling companies, it admitted that smaller operators might be disproportionately affected by the tax hike. For example, Betfred announced it would close over 130 shops across the country, affecting roughly 600 jobs. The company attributed this decision to higher UK taxes that forced it to reorganize its offerings. Despite steady revenues, even high-profile operators were forced to adapt to the new taxes. Entain and Bet365 withdrew from longstanding sponsorship agreements with racing organizations, citing the new tax regulations. Nearly all companies in the sector have been forced to cut marketing and sponsorship spending. However, the expected consolidation has not yet happened as operators remain competitive. The Regulus report ultimately admitted that the UK market was especially difficult to forecast, as problems often remained hidden until they could no longer be ignored. It believes that while most operators chose to maintain their bonusing spending, this strategy may not be sustainable in the long term and could affect revenues if left unaddressed.