MP raises questions over impact of UK gambling tax hike on Gibraltar

Ministers have pledged to monitor the impact of the gambling tax rise on the self-governing territory.

UK.- The UK government came under pressure this week to examine how the upcoming rise in Remote Gaming Tax from could affect Gibraltar’s economy. Concerns raised in Parliament by Labour MP Gareth Snell, who represents Stoke-on-Trent Central.

Remote Gaming Duty in Britain will rise to 40 per cent from April 1, while Remote Betting Duty will rise to 25 per cent from the same date in 2027. Snell tabled an amendment to the Finance Bill during its third reading on Wednesday seeking an assessment of the consequences of the the tax change. He called for the findings be published by April 1 2027, when the rise in Remote Betting Duty is scheduled to come into force.

Speaking in the House of Commons, Snell said: “One third of Gibraltar’s tax receipts come from the [gambling] sector, so anything we do in this place that has an impact on the sector there – I entirely accept that this is not an intended consequence of the decision – would leave a huge hole in its economy, and that will have to be filled.”

Snell also pressed for an evaluation of how the duty increases might influence the gambling black market. However, Alex Ballinger, MP for Halesowen, dismissed this, arguing that industries linked to harm often exaggerate black market threats to resist regulation.

“In the gambling sector, the threat of the black market is overblown. The regulated market is dominant, and in recent years there have been lots of taxation changes that have not increased the size of the black market,” Ballinger said, citing a 2021 Gambling Commission study that found only a small fraction of UK gamblers used unlicensed sites.

Dan Tomlinson, MP for Chipping Barnet, confirmed that ministers would not alter the bill but pledged to “monitor the impact of the change” while maintaining dialogue with Gibraltar officials.

After the announcement of the tax hike in the autumn budget, Gibraltar’s minister for justice, trade and industry, Nigel Feetham KC, warned the self-governing territory’s parliament that it would needs to start “doing things differently”. He said the tax hike was an issue “of vital importance to Gibraltar” and could have both direct and indirect consequences for public finances.

Feetham said Gibraltar had been an “international centre of excellence for online betting and gaming for decades, ever since the development of our gold standard regulatory framework for the sector in the 1990s”. But he said the UK tax changes would impact on the “vital work” the Gibraltar government has undertaken over the past two years on corporate tax reform.

Feetham noted that revenue from the gambling industry in Gibraltar plays a crucial role in funding essential services such as healthcare, education, and broader public finances. The extent of the impact on Gibraltar’s corporate tax and PAYE receipts will depend on how effectively local operators can absorb or offset the higher UK tax costs. Feetham warned that if mitigation strategies include job reductions, this would directly affect PAYE contributions.