Flutter Entertainment has warned that the planned tax increase from 21% to 40% by April 2026 will reduce its adjusted EBITDA by an estimated £650 million across FY2026 and FY2027. The announcement follows the Government’s confirmation of the single largest tax escalation ever applied to online casino-style gambling in the UK. While positioned as a public health measure intended to address gambling-related harm, the fiscal adjustment is set to impose significant operational challenges for regulated online operators.
Flutter responded by outlining a mitigation strategy involving phased reductions in operational, marketing and promotional spending. The company expects to achieve 20 percent savings within the first six months of implementation, increasing to 40 percent thereafter. Executives argue that the new tax structure may inadvertently empower illegal gambling operators, who already pose a growing threat to channelisation efforts.
Industry reactions reflect similar concerns. Entain has issued a profit warning, Evoke Holdings has withdrawn medium-term guidance and is considering asset sales, and several companies experienced double-digit share price declines. More than £8 billion in market value was wiped out across the sector in a single trading session.
Despite harsh conditions for online operators, land-based betting shops, casinos and bingo halls receive relative stability. Bingo duty is set for abolition in 2026, and machine gaming duty remains unchanged. Horseracing also secured protection, with the Treasury confirming that Horserace Betting Duty will remain at 15 percent following extensive lobbying.
Analysts warn that higher taxes may accelerate player migration to illegal offshore platforms, which already capture the majority of Europe’s online gambling activity. As the UK prepares for these sweeping changes, operators and regulators face a rapidly evolving landscape defined by tighter margins, competitive pressure and heightened channelisation risks.
