Gibraltar Warns Of Heavy Blow To Online Gambling Sector After UK Budget Tax Hike

_{Gibraltar serves UK facing operators. (Image: Glyn Thomas/Alamy)}

Gibraltar faces substantial economic headwinds after the UK’s Autumn Budget sharply increased online gambling taxes, placing pressure on the territory’s biggest private-sector employer. Leading industry figures have expressed concerns that there will be a risk to jobs especially the online gambling sector including online casinos and UK facing Operators. 

Minister for Justice, Trade and Industry Nigel Feetham told Parliament the decision to raise remote gaming duty from 21% to 40% and online betting tax from 15% to 25% will have direct consequences for Gibraltar’s economy, which depends heavily on UK-facing operators.

The sector represents about 30% of Gibraltar’s GDP, employs more than 3,400 people, and contributes roughly one-third of annual tax receipts through a mix of corporate and personal taxes, social insurance, and gambling duties. Operators based in the territory already pay about £750 million a year to the UK Exchequer in point-of-consumption taxes.

Industry Figures say UK-Facing Operators Could Face Severe Strain

Grainne Hurst, CEO of the Betting and Gaming Council, said the minister’s warning reflects the scale of the challenge for operators serving the British market.

“Minister Feetham’s statement to HM Government of Gibraltar highlights the significant impact of the UK Autumn Budget on the online gambling sector, a key pillar of Gibraltar’s economy and employer of more than 3,400 people.”

She said the sector has been clear about the risks posed by the tax increases. “The steep increases in remote gaming duty and online betting tax will place real pressure on UK-facing operators, with clear implications for jobs and revenues. Throughout this process, industry and stakeholders have worked hard to set out these risks.”

Her comments underline the alignment between UK and Gibraltar operators, which are dual-regulated and share compliance frameworks, workforce pipelines, and investment ties.

Government says Effective Tax Rates Could Hit 80 to 100 Percent

Feetham told Parliament that modelling in the UK indicates the new measures could push effective tax rates for online operators to between 80% and 100%. That level, he said, risks reducing corporate tax payments in Gibraltar and may lead some operators to cut jobs to manage rising UK costs.

Gibraltar had already begun overhauling its corporate tax framework through its National Tax Strategy. Feetham said the UK budget changes threaten progress made in raising domestic revenues without increasing the burden on ordinary workers.

He also noted that the UK decided not to raise taxes on retail betting shops, bingo halls, casinos or gaming arcades, and even abolished retail bingo duty. With retail gaming spared, the entire increase falls on online operators, a move that Gibraltar argues could distort the market and benefit unregulated offshore platforms.

Hurst acknowledged the recognition given to industry advisers during the process. 

“I was honoured that the Betting and Gaming Council, Stephen Hodgson and I were thanked for our advice and support during this challenging period. His recognition underscores the strong partnership between government, regulators and industry.”

Gibraltar Pushes Diversification but Warns that Rebuilding Takes Time

Feetham said Gibraltar has already intensified work with the Gibraltar Regulatory Authority and the Financial Services Commission to expand recovery efforts into fintech, AI, blockchain and other technology-driven sectors. The government is also accelerating efforts to grow non-UK gambling markets to reduce reliance on operators serving Britain.

But Feetham cautioned that even fast-tracked diversification cannot immediately replace the revenue at risk. He told Parliament that it took decades to build the sector and that any erosion in confidence could damage the economy far more quickly.

While the government expects to introduce a new Gambling Bill with cross-party support, it is preparing for a period of financial pressure as operators assess the long-term viability of their UK-facing operations.

Budget Risk to Jobs

Gibraltar’s gambling industry and UK-aligned partners appear united in warning that the UK Autumn Budget will reshape the sector’s economics. With thousands of jobs and a major share of public revenue tied to online betting and gaming, Gibraltar faces a pivotal period as it works to steady its economic base and retain its position as a global hub for regulated online gambling.