Labour MPs Urge Gambling Tax Rise to Fund the Child Benefit Reform

Labour MPs call for a rise in gambling taxes to fund the child benefit reform and abolish the two-child benefit cap.

The UK Autumn Budget is coming up, and in a bold move, 101 Labour MPs have called for a gambling tax rise.

The MPs requested Chancellor Rachel Reeves to increase the gambling tax in order to fund the abolition of the two-child benefit cap. The cap is a big reason for the deepening of child poverty across Britain, according to the MPs.

A rally behind the tax reform

The campaign is spearheaded by the All-Party Parliamentary Group (APPG) and backed by former Prime Minister Gordon Brown. It proposed a targeted levy on UK casinos and online gambling products as the MPs argue that the UK’s betting industry contributes very little to the domestic economy.

The main reason is that UK betting companies employ very few people, and as they are often located outside of the UK to minimise their tax bills, they really bring very little value to the table.

The proposed reforms to the UK gambling regulations suggest raising the Remote Gambling Duty on online slots, poker, and bingo from 21% to 50%.

And increasing the Machine Games Duty on cash prize slot machines from 20% to 50%. On top of that, they suggest doubling the General Betting Duty on sports betting from 15% to 30%.

Based on info from the Institute for Public Policy Research (IPPR), this could generate an extra £3.2 billion in 2026/27, which will be enough to remove the two-child benefit cap and the household benefit cap. It could potentially help lift 500,000 children out of poverty.

Reeves on it

Chancellor Rachel Reeves has stated that the proposals are on the table and that she has already launched an inquiry into gambling taxation earlier this year. The chancellor ordered a consultation to simplify betting firm taxation to a single, unified rate in April.

While the consultation has closed, no conclusions have been announced yet. It is expected that Reeves will make her final decision about the budget on the 26th of November 2025.

Reeves said to ITV that there was no need for MPs or former chancellors to tell her to launch an enquiry into gambling taxation. She stated that she’ll set out the plans on the taxation of gambling and other areas in her budget.

Industry pushback

One of the biggest concerns at any time is that clamping down on the regular market will increase the activity of the black market and illegal casinos. And this is exactly what the Betting and Gaming Council (BGC) are concerned about.

The BGC represents the UK gambling sector and is fiercely opposing the proposed hikes. CEO Grainne Hurst has warned that such drastic measures could backfire massively and push bettors towards the unregulated black market. It does contribute nothing to taxes and has no consumer protection in place.

The CEO used the recent Dutch reforms as an example. In the Netherlands, the recent tax hike led to a 25% drop in gross gambling revenue and a massive €200 million loss in tax. Hurst reminded that increased taxes do not mean increased tax take, as in the case of the Netherlands, it could mean less.

The BGC stated that its members contribute around £6.8 billion to the economy. And they pay £4 billion in taxes while supporting 109,000 jobs. They also fund responsible gambling initiatives, sports, including horse racing, the English Football League and other sports leagues such as darts and snooker.

A call for balance

As the debate continues to intensify, Reeves is facing lots of pressure from reform advocates and industry stakeholders. There are big decisions to make that can have a massive impact on the economy.

Reeves will be sharing the outcome of her budget on the 26th of November 2025, and it could reshape the UK’s gambling landscape and potentially lift thousands of children from poverty.

Make sure you don’t miss any new updates on the upcoming budget news by subscribing to CasinoWow.

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By Deni

Verified Casino Expert

Expertise: Casino Content Writing, Journalism & (PR), Gambling Regulations, Dutch & German Gambling Markets

Hi, I'm Deni! I'm a research obsessive with a passion for gambling regulations, market trends, and casino news. I dig deep into every topic I cover - so every article, review, or guide I write is built on solid research and real detail.

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Last updated: October 13, 2025

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Labour MPs urge gambling tax rise to fund the child benefit reform

A rally behind the tax reform

Reeves on it

Industry pushback