Don’t make a losing bet

Why disproportionate gambling tax hikes would cost the UK jobs, revenue to the Treasury and consumer protection.

I joined Entain over 10 years ago and have been privileged to oversee our UK retail operations and visit many of our betting shops across the country. With around 1 million customers each year, these shops are more than just locations to place a bet; they are integral parts of the communities they serve and vital components of the UK high street. Now their future is at risk.

Britain can’t tax its way to growth. That was the Prime Minister’s line earlier this year - and on this, he’s right. When it comes to gambling, the numbers are clear: piling on new taxes will not raise more money. Higher taxes on betting shops will cause closures, cost jobs and reduce investment into horse racing. Higher taxes on online betting and gaming will also cost jobs, reduce investment into British sport at elite and grassroots levels, and shrink the regulated market. More business will be handed to illegal, unlicensed operators who pay no UK tax and protect no one. The net result? Tax take goes down.

Entain is already one of the UK’s largest contributors to the Exchequer. We employ around 14,000 people and in 2024 we paid over £500m in UK taxes - placing us among the nation’s top taxpayers. Our effective UK tax rate is around 65 per cent, meaning that for every £1 of operating profit before tax, around two-thirds goes to the Treasury. We are proud of that contribution and of the thousands of good jobs we support in the UK. But there is a point at which more tax becomes counterproductive. We are already there.

Much of the public debate focuses on online, but Ministers should not overlook the retail network of over 6,000 betting shops that still anchor many high streets. The shops and their people are part of the fabric of local communities. For some customers, they are a key part of their social lives.

They offer flexible jobs that suit people with caring responsibilities, they hire just as many women as men, and they help drive footfall to neighbouring retailers. Yet their profitability is fragile and trending down as costs rise. We are sad to say we have already closed around 30 per cent of our shops in the last six years. The 2,300 that remain are still absorbing last year’s rises to National Insurance and the National Living Wage. Those increases added £25m in annual costs. Any further tax hike in this month’s Budget will tip many more shops over the edge.

Within our industry, well over 1,000 shops are already marginal or loss-making. Close them, and you don’t just lose jobs and hurt the high street; you also lose tax. A single marginal shop typically contributes over £100,000 a year in gambling duties, VAT, business rates, payroll taxes and the racing levy. So closures would hit employment, the Treasury and the horse racing ecosystem. At Entain, 60 per cent of our contribution to horse racing comes from our retail estate. So as shops close, funding for racing depletes. This helps no one.

There is also a hard lesson from overseas. Countries with higher online gambling tax rates see bigger black markets. And black market operators pay zero tax.

Today, the UK’s regulated sector is among the safest in the world, with extensive checks and interventions to protect customers. But unlicensed offshore sites are hard for consumers to spot - many openly market to British consumers, including through prominent sports sponsorships - and offer none of those protections. They pay no UK tax, evade our rules, and attract vulnerable players with fewer checks and more aggressive promotions. Every percentage point added to online taxes makes these sites more attractive. That doesn’t just undermine tax receipts; it undermines player protection.

The Netherlands raised its gambling tax to 35 per cent this year. The result? A surge in illegal operators, now accounting for 50 per cent of the market, and falling tax revenue. Once the black market gets a foothold, it’s hard to dislodge. We shouldn’t repeat that mistake.

We’re already seeing worrying signs at home. Thousands of unlicensed operators now target British players. The Gambling Commission has noted the scale of illegal sites and the challenge of blocking access. Turning the tax screw tighter on licensed operators risks accelerating this shift. We must not give the black market any more advantages.

No responsible operator opposes paying their fair share of tax. We already do. What we ask is that the Autumn Statement takes an evidence-led approach and follows the maths:

Do no harm to retail. Leave high street betting shops out of any increase. Protect jobs, maintain levy flows to racing, and avoid hollowing out town centres.

If harmonising online taxes, keep rates growth-friendly. Beyond a certain point, higher taxes don’t bring in more money as activity leaks offshore.

Supercharge enforcement against the black market. Use modern tools and coordinated action to keep consumers within the regulated, tax-paying net. It’s a win-win for the Treasury and for protecting customers.

The UK is rightly proud of its world-leading approach to regulated gambling. Entain is proud of our contribution - 14,000 UK jobs and more than £500m in tax last year - and we want to keep investing and growing here. But if policy overshoots, everyone loses except the black market. Let’s not make that mistake. Let’s choose a sustainable tax framework that protects consumers, revenues, British sport and British jobs.

Rob Wood is Chief Financial Officer and Deputy CEO of Entain Group.