The illegal market’s share of online betting is projected to grow significantly, with forecasts indicating an increase from 10 percent last year to 22 percent by 2031, as Labour’s recent tax hikes on the sector take effect, reports BritPanorama.
According to a recent report, the rise is attributed to changing consumer behaviours and the increased financial pressure resulting from the government’s fiscal policies. The offshore gambling sector’s turnover has surged from £5 billion in 2019 to over £16 billion today, highlighting a substantial shift towards unregulated operators.
The betting industry has warned that customers will inevitably seek alternatives if domestic regulations become too burdensome. With forecasts suggesting that the turnover could reach £36 billion by the early part of the next decade, concerns are mounting over the long-term viability of regulated betting firms in the UK.
Current projections indicate that more than one in five pounds bet online may eventually shift to offshore firms. This trend reflects a broader issue within the sector where the share of bets placed with licensed operators is expected to decline from 90 percent to 78 percent.
Following the Chancellor’s substantial increase in the Remote Gaming Duty to 40 percent in April, industry stakeholders have expressed alarm. Grainne Hurst, the chief executive of the Betting and Gaming Council, stated: “The Chancellor’s tax hikes are handing illegal gambling operators a competitive advantage.”
Hurst emphasised the UK’s esteemed regulated betting industry, which supports over 109,000 jobs and contributes approximately £4 billion in taxes annually. She warned that continued tax increases could drive consumers to unregulated markets, where safety protocols and consumer protections are effectively absent. “The only winners from these tax hikes will be criminal operators based overseas,” she cautioned.
With another potential tax hike looming in April next year, stakeholders remain concerned about the implications for jobs, investment, and tax revenues within the UK. The government’s strategy appears increasingly counterproductive, pushing consumers into less secure options without the safeguards of the regulated sector.
This developing landscape in the betting industry raises critical questions about regulatory balance and consumer protection, urging a reevaluation of the policy approach towards gambling and its governance.
