BGC Warns Tax Rise Could Cost Thousands of Jobs, EY Report Finds
An EY-commissioned analysis warns that higher gambling taxes could eliminate tens of thousands of UK jobs.
LISTEN TO THIS ARTICLE:The Betting and Gaming Council (BGC) has urged the UK government to rethink proposed gambling tax increases after commissioning Ernst & Young (EY) to quantify the economic fallout. The independent EY study, released this month, concluded that tax hikes modelled by think tanks including the Social Market Foundation (SMF) and the Institute for Public Policy Research (IPPR) risked large-scale job losses, substantial falls in economic output and a sharp rise in unregulated betting activity.
EY Analysis Predicts Job Losses and Black Market Growth
EY’s modelling examined two sets of proposals: the SMF’s recommendation to raise online gaming tax rates and the IPPR’s more ambitious tax increases. According to the report, the SMF scenario could cost roughly 30,200 jobs and reduce sector gross value added (GVA) by about GBP 2.5 billion. The IPPR-style package would produce a larger impact: EY estimates up to 40,000 jobs lost and approximately GBP 3.1 billion knocked off industry GVA.
Both scenarios are projected to push significant wagering into the unregulated market. EY found the SMF proposal could divert some GBP 8.1 billion of bets away from licensed operators, while the IPPR scenario could channel roughly GBP 8.4 billion into higher-risk black-market channels. The report also challenged revenue expectations set out by proponents of the higher-tax approach. While the IPPR suggested the measures could raise around GBP 3.2 billion, EY’s net estimates, after accounting for behavioural responses and economic harm, suggest a likely short-term uplift of around GBP 1 billion or less.
EY additionally disputed growth assumptions used by the think tanks. Whereas the SMF and IPPR applied an optimistic trajectory, described by EY as a 31% expansion over a three-year window, the consultancy’s baseline forecast for the industry’s 2023–26 growth is about 4%.
The report also criticised both think tanks for not fully incorporating the potential effect of the government’s own upcoming white paper and regulatory changes, an omission EY says could materially change outcomes for operators, consumers and public finances.
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Grainne Hurst, chief executive of the BGC, framed the EY findings as a stark choice for ministers. "The figures speak for themselves," Hurst said. "A sudden spike in gambling duties may look attractive on paper, but it risks sacrificing long-term jobs, investment and consumer protections for a short-term revenue headline. The government should pursue balanced regulation and a stable tax regime that recognises the value of a regulated British industry."
The BGC underlined the scale of the regulated sector: its members account for substantial employment and economic activity across regional tech hubs including Stoke-on-Trent, Manchester, Leeds, Nottingham, Sunderland and Warrington. The council says its membership contributes millions of pounds in wages, tax and local supply-chain activity and supports more than 100,000 roles in related industries.
Operators and trade bodies have repeatedly warned that steep tax increases could force some businesses to downsize or exit the market, and that consumers would likely migrate to overseas or illicit platforms offering higher odds or anonymity. That shift would reduce the regulators’ ability to enforce anti-money-laundering rules, age checks and safer gambling measures designed to protect vulnerable customers.
HM Treasury and the Gambling Commission have not yet announced immediate policy moves in response to the EY study. Officials are expected to weigh the report alongside input from independent researchers, operator submissions and the wider public consultation on the white paper ahead of any formal legislative proposals.
What happens next will be closely watched by industry leaders, regional governments and consumer groups. The government faces a trade-off between short-term fiscal receipts and preserving regulated employment and protections, while regulators will need to balance revenue objectives against consumer-safety risks posed by migration to the black market.
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