HMRC Q2 Data Undercuts UK Gambling Tax Mitigation Claims
HMRC reported £376m in RGD receipts for Q2 2026, a 22% rise despite the rate increase from 21% to 40%. The data undercuts industry claims that tax hikes shrink the overall take via operator mitigation. With MGD doubling under discussion for the 28 October budget, lobbying on shop closures and racing revenue faces stiff headwinds.
SCCG Take — The figures give ministers political cover to treat gambling as a reliable revenue source, tilting the balance toward higher MGD and away from retail operators and horse racing.
Provisional HM Revenue and Customs figures for the first full quarter under the elevated Remote Gaming Duty rate have handed the Labour government fresh evidence in the debate over further gambling tax rises. RGD receipts reached £376m for April to June 2026. That total is 22% higher, or £67m higher, than during Q2 2025, according to SBC News.
The duty itself rose from 21% to 40% on 1 April 2026, excluding sports betting. The Q2 sum nevertheless sits below the £360m recorded in Q1 under the old rate. The numbers directly challenge the industry’s long-standing assertion that tax increases trigger operator mitigation—lower odds, reduced marketing—that ultimately shrinks the revenue base and the tax collected on it.
The data arrives early in the new regime, before the full force of any adjustments would register. The Netherlands is cited as precedent: 2025 duty increases there delivered just €2m in extra revenue against an anticipated €108m. With Chancellor of the Exchequer John Healey due to deliver the first budget of Burnham’s administration on 28 October, the HMRC statistics are likely to feature in discussions of additional revenue measures.
Machine Games Duty in the Fiscal Crosshairs
Healey and Burnham are rumoured to be weighing a doubling of all Machine Games Duty rates. The changes under discussion would lift the 5% rate on Type 1 machines to 10%, the 20% standard rate on Type 2 machines to 40%, and the 25% higher rate on remaining machines to 50%. Current MGD receipts have held steady near £160m in Q1 2026 and rose to £162m (up 5%) in the April-June period.
Where the Risk Lies for Retail and Racing
The Betting and Gaming Council has escalated its “Back Our Betting Shops” campaign, emphasising potential high-street damage. JenningsBets founder and CEO Greg Knight has warned that higher MGD could force more than 100 of his outlets to close, months after the firm opened its 200th venue. The British Horseracing Authority points to £2.9bn in horse racing turnover from betting shops in 2025/26 and forecasts that a 40% standard rate would close 4,050 shops, cost 28,000 jobs, strip $24m from the levy and £68m from media rights, and cut combined racing and betting receipts to the Treasury by 32%.
BGC CEO Grainne Hurst added casinos to the brief, noting more than £200m in planned investment for 2026/27 that could lose over £50m under the higher rates. “These are not just investments in casinos,” said Hurst. “They are investments in Britain’s towns and cities. They create skilled jobs, drive footfall for neighbouring businesses and support the restaurants, hotels, bars and attractions that help our high streets and city centres thrive.”
Countervailing voices are audible. The Social Market Foundation continues to press for higher MGD, backed by former Prime Minister Gordon Brown and researcher James Noyse, who recently shared a platform with incoming Gambling Minister Vicky Foxcroft. The government’s infrastructure, care service and defence spending ambitions, set against inflation and external fiscal pressures, leave the industry arguing from a position of limited political sympathy.
Reporting: SBC News
Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.
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