UK horse racing turns on online casinos over tax reform
A deepening divide has emerged within the UK’s £11.5 billion gambling industry as horse racing figures break ranks to support higher taxes on online casinos.
The rift was exposed during a Social Market Foundation meeting attended by Treasury officials, MPs, racecourse executives, and the British Horseracing Authority, according to The Guardian. As the government mulls a proposal to unify tax rates across online betting and gaming products, senior racing executives pushed back—arguing that taxing online casinos more, rather than applying a single harmonised rate, would both protect the future of horse racing and boost tax revenue.
Racing for distinction
Martin Cruddace, CEO of Arena Racing Company, captured the sentiment of many within the racing sector: “It is imperative that British horse racing continues to make the clear case that betting on its sport is taxed and regulated differently from online casino and arcade games and even other sports. Any harmonisation of tax… would have the consequence, however unintended, of Britain being a world leader in online casino and a world pauper in the global sport of horse racing.”
Racing leaders argue that, unlike online casinos, their sport provides tangible economic and cultural value through local events and venues, with higher operational costs and less risk of addiction-related harm. Some even criticised online casinos for their “minimal” contributions to local economies and “staggering” potential for harm.
The growing concern within the racing world is that the sport is increasingly being “tarred with the same brush” as digital slot machines—an association they fear will drive fans and punters away.
BGC warns against tax changes
The Betting and Gaming Council (BGC), which represents much of the UK’s gambling industry, is standing its ground against any increase in taxes. One proposal on the table would merge existing tax rates into a single levy for all online betting and gaming. But the BGC argues this approach could push up the tax burden on online sports betting—something they say could have serious knock-on effects for the financial support horse racing relies on.
In a press release, the BGC highlighted that its members are expected to contribute a record £108 million in Levy payments to the Horserace Betting Levy Board (HBLB) for 2024–2025—the fourth consecutive year of increase, despite a significant decline in betting turnover. The HBLB reported that average turnover per race fell 8% year-on-year and has dropped 19% since 2021–22.
BGC CEO Grainne Hurst stated:
“For the fourth year running, Levy contributions have increased to record levels, demonstrating the growing, long-term investment regulated betting provides British horseracing. But it is concerning to see once more that despite record Levy contributions, racing continues to struggle, both as a sport and as a betting product… It’s now more important than ever this vital contribution is not undermined by further new tax rises.”
Hurst warned that higher taxes risk driving bettors to the unregulated black market:
“These parasite operators don’t pay tax, don’t care about safer gambling, and do not contribute a penny to the Levy.”
A sector at a crossroads
Horse racing, the UK’s second-largest spectator sport, contributes significantly to the economy, attracting six million attendees across 59 racecourses each year. The BGC estimates that its members contribute £350 million annually to British horseracing through Levy payments, media rights, and sponsorship, while the broader regulated betting sector supports 109,000 jobs and contributes £6.8 billion to the UK economy.
With attitudes shifting and key industry players taking opposing sides, the UK gambling sector may be heading for a major policy showdown. Whether tax harmonisation proceeds or a tiered system emerges, the decisions made in the coming months could reshape both the betting landscape and the future of British racing.
