Northern Ireland and Gibraltar on opposing sides in UK gambling tax hike debate

The divisive and polarized nature of the UK gambling tax hike debate has been well publicised, with the ruling Labor government’s plans backed by think tanks and reform campaigners, in contrast to the defensive stance taken by the gambling industry.

However, the multi-faceted situation can be seen through a different lens, with Northern Ireland and Gibraltar on opposite sides of the UK gambling tax hike debate.

The chancellor, Rachel Reeves, is currently consulting and considering changes to the gambling tax system as part of wider fiscal measures to strengthen the public purse ahead of the next budget announcement, expected on November 26.

Remote Gaming Duties (RGD) currently stand at 21% of online casino and slots gross winnings, while online sports betting is subject to a 15% General Betting Duty (GBD).

One proposal as part of the UK gambling tax hike debate was to bring fairness by harmonizing taxes on gambling activities into a single Remote Betting and Gambling (RBGB) duty of around 21%.

It would increase funds raised for the UK Treasury, positioned as « tax security » by government sources, but key industry players and representative organizations have criticized the increase, saying it would put jobs at risk while having no real impact on harm reduction.

The general arguments for and against tax increases on the gambling industry are partly fueled by self-interest, but there are many more nuances to the wider debate, which will have a ripple effect in the UK and beyond.

Northern Ireland is a constituent country of the United Kingdom, along with England, Scotland and Wales.

It is subject to the laws of the United Kingdom on important matters such as taxation, defense and foreign affairs, but in addition Northern Ireland has its own devolved government on local matters.

Treasury Select Committee Calls for Higher Gambling Taxes Despite Industry Fearmongering https://t.co/npi21XJiOT

— Matt Zarb-Cousin (@mattzarb) November 7, 2025

Northern Ireland calls for more punitive taxes on harmful gambling

In the Northern Ireland Assembly, the All Party Group (APG) on Gambling Harm Reduction has opposed proposals for harmonization but, crucially, not tax increases.

The APG is led by Philip McGuigan MLA, who has spoken publicly about his own struggles with gambling harm, which has cost him more than £100,000 ($130,810).

In an open letter to UK Chancellor Rachel Reeves, APG warned this « Harmonization will effectively incentivize gambling companies to steer customers away from less harmful products such as sports betting and horse racing to highly addictive online casinos and slot games. »

APG wrote to the chancellor to raise concerns about plans to harmonize tax rates for different forms of online gambling and backed calls for a significant increase in tax rates for the most harmful ‘remote gaming’ products (online slots and casinos). https://t.co/1vxdgGowWN

— Gambling Harm Reduction APG (@GamHarmAPG) November 5, 2025

He takes the position that gambling harm will be exacerbated by equalizing taxes across the spectrum, from the less addictive sports betting to more harmful online activities such as instant slots.

APG would like to see a different approach, by aggressively increasing RGD to 50% and increasing GBD to 25%.

While this would have huge implications for the gambling industry, the APG points to an increase of £2 billion ($2.6 billion) which could make a significant difference to tackling gambling harm, protecting young people and offsetting advertising bans.

Northern Ireland representatives have accused Westminster of prioritizing revenue from the gambling industry over meaningful change and the protection of at-risk consumers.

The APG further outlined the critical local situation as outdated legislation means remote gambling has no legal basis in Northern Ireland at present, with the province having the highest rate of problem gambling in the UK.

As a result, gamblers cannot benefit from the same regulatory protections as consumers in the United Kingdom (rUK).

APG chairman Philip McGuigan added: « Remote gambling, and online gaming and slots in particular, causes untold harm to people, families and communities here. It is unacceptable that these highly addictive products should be taxed at the same rate as less harmful gambling activities such as horse racing betting.

“The statistic that we have the highest rate of problem gambling is deeply concerning and urgent action is needed.

« We are calling on the UK Chancellor to reject these tax harmonization proposals and instead use the forthcoming Budget to increase taxes on the remote gambling industry. This will protect people, reduce harm and raise much-needed funds for public services. »

Conversely, Gibraltar takes the opposite position, driven by the protectionism of its own economic interests.

« The Rock » is a British overseas territory located on the southern tip of Spain.

It is a self-governing entity, but the people of Gibraltar continue to vote in referendums to remain under British sovereignty, making it an effective British outpost in Spain.

The Spanish government continues to claim sovereignty over Gibraltar, but relations between the respective nations are largely cordial.

High Street Alert: @WilliamHill, @Betfred, @PaddyPower and @EntainGroup all say higher gambling taxes could close shops, drain local economies and cut funding for UK racing.https://t.co/dBg6M8HcFI pic.twitter.com/3lqWn09h5L

— Betting and Gaming Council (@BetGameCouncil) October 30, 2025

Gibraltar’s protectionist stance driven by economic security and stability

Driven by tax and VAT incentives, Gibraltar is a major hub for online gambling operators that serve the UK, and in return more than 80% of Gibraltar’s economy is directly linked to the gambling industry.

No wonder there is growing concern over the prospect of a sharp increase in gambling taxes that will have ramifications beyond the UK mainland.

Andrew Lyman, the Gambling Commissioner for Gibraltar, who also serves as a non-executive director of the Independent Betting Adjudication Service (IBAS), recently made a rare public comment on the UK gambling tax hike debate, warning of dire consequences for the UK and Gibraltar economies if the tax increase materialises.

Normally indifferent to the bigger political picture, Lyman wrote this on LinkedIn « The idea that industry can absorb significant top-line tax increases and not suffer a wider structural impact and loss of bottom line profit is disingenuous. »

He admitted that an increase of up to 5% in RGD could be taken up, but anything significantly higher, around 30%, could cause « irreparable damage to the sector ».

His comments were echoed by Gibraltar’s finance minister, Nigel Feetham, who warned that: “even a modest increase could drain up to £160m a year of Gibraltar’s tax revenue as operators may relocate or reduce operations targeting the UK.’

Gibraltar’s position is clearly influenced by self-interest and economic stability, but it is interesting to note that it puts its own affairs ahead of issues of generating revenue for the UK, despite the close relationship between the entities.

Feetham’s warning was highlighted this week after it was revealed by ITV that Sky Bet had moved important business functions to Malta to avoid around £55m ($71.9m) in tax a year.

The Flutter Entertainment-owned company was the subject of a report by Tax Policy Associates what happened, why Skybet moved to Malta and how HMRC (UK Revenue) might react.

What’s next for gambling tax hike proposals ahead of UK budget?

Recent indications are that the UK government will not take a harmonization approach, but will instead adopt a two-tier system for sports betting, except for horse racingwith higher taxes on online gambling compared to bets placed in physical betting premises.

It was discussed that Chancellor Reeves would choose to retain the 15% GBD for physical sports betting, while online betting would be subject to a moderate increase.

The RGD from online casino and slots betting is expected to be increased, but there is no indication at this stage how far the Labor government will go.

Their position may even change, as has happened with other policies, before November 26.

The UK betting industry has warned of dire consequences, including Betfred says all its retail stores may be forced to close as a result of the tax increase, while on The Betting and Gaming Council has warned that 40,000 jobs could be at risk.

The different positions taken by Northern Ireland and Gibraltar on the tax increases reflect the sheer difficulty of finding a balance in the overall debate over increased gambling taxes in the UK.

Consumers and players at risk must be protected, but the reality of job retention and the threat of losing betting operators to more favorable tax jurisdictions cannot be ignored.

There is a lot of gray in this, which is definitely not black and white, but Chancellor Reeves and the Labor government must find a way to appease competing interests for the betterment of the UK economy while mitigating the harm from gambling.

Image credit: Canva / UK Parliament / Chris McAndrew / CC BY 3.0

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