The chief executive of Entain, the FTSE 100 gambling giant owning Ladbrokes and Coral, has issued a stark warning ahead of the UK government's forthcoming November Budget. Stella David cautioned that proposed increases to gambling taxes could force widespread closures of betting shops and significantly reduce the company's investment in the UK. Speaking in her first interview since being confirmed permanently in the role in April, David stressed that any rise in gambling duties would compel Entain to reassess its commitment to the domestic market. She noted, "There is no doubt" that escalating taxes would render many of the firm's 2,300 high street betting shops unviable, forcing closure. David also underscored that while Entain aims to maintain a profitable global business, the UK must remain competitive or the company may pivot its focus elsewhere.

The government is reportedly considering substantial hikes to gambling levies, including raising the remote gambling duty on online betting from 21% to as high as 50%, boosting slot and gaming machine duties from 20% to 50%, and increasing the betting duty on general non-racing bets from 15% to 25%. These measures have been backed by former Prime Minister Gordon Brown as a means to fund social welfare reforms, such as the removal of the two-child benefit cap. An Institute for Public Policy Research (IPPR) report estimates such reforms could generate around £3.2 billion annually for the Treasury. Chancellor Rachel Reeves has indicated a willingness to ensure gambling firms "pay their fair share," signalling potential increases in the sector's tax contribution.

Entain, however, insists it already makes a significant fiscal contribution, claiming to be one of the UK's top 20 taxpayers with £513 million paid to the Exchequer last year alone. Industry-wide figures presented by the Betting and Gaming Council suggest gambling operators contribute in excess of £4 billion annually in taxes, alongside substantial funding to sport—including £350 million directed to British horse racing, £40 million to English football, and more than £12.5 million to other sports such as snooker, darts, and rugby league.

A key concern raised by David is the unintended consequence of tax hikes benefiting unregulated "black market" operators. These illegal platforms, she explained, siphon money out of the UK economy with no tax returns and minimal oversight, all while appearing professional and attracting UK customers unaware of their illicit status. David pointed to the Netherlands as a cautionary example, where a tax rise from 30.5% to 34.2% earlier in 2025 coincided with declines in both online and retail gambling revenue, according to the national regulator.

The broader gambling sector faces mounting challenges, particularly on the high street. Since 2019, over half of UK betting shops have closed, reducing their numbers to fewer than 6,000, a decline driven by increased online betting, the £2 maximum stake on gaming machines, and the COVID-19 pandemic. Recent Labour Party pressure has intensified calls to double gambling-related taxes, with over 100 MPs rallying for major increases in online gambling duties and betting levies. Analysts warn that up to 80% of the remaining shops may close under these conditions, potentially causing the loss of around 30,000 jobs. This downturn would also threaten the significant funding the gambling sector provides to the horseracing industry, which recently staged a historic strike to protest taxation changes it deems existential.

British horseracing, which supports approximately 85,000 jobs and contributes over £4 billion a year to the UK economy, faces substantial risk from such proposed tax reforms. The British Horseracing Authority, which campaigns under the banner "Axe the Racing Tax," has condemned the planned consolidation of betting duties that could see taxation on race bets rise from 15% to 21%. The industry views these moves as highly disruptive, with jockeys and trainers warning of job losses and financial instability. The government counters that the aim is simplification rather than rate increases, yet the racing community remains deeply concerned.

At the same time, the UK government is pursuing regulatory liberalisation for land-based gambling venues like casinos and bingo halls to help modernise and support these bricks-and-mortar operators. Proposed reforms include lifting bans on direct debit payments for gaming machines and increasing machine allowances, signalling a nuanced approach amid the tightening tax environment.

Financial markets have reacted sharply to the unfolding debate. Major gambling firms—including Entain and Flutter Entertainment, parent of Paddy Power and Betfair—have seen significant share price falls amid fears over escalating tax burdens. The Betting and Gaming Council has voiced strong opposition to proposed hikes, warning of jeopardised jobs, hindered sector growth, and damage to linked industries such as horseracing. They highlight the broader economic contribution the industry makes, with an estimated £7.1 billion generated for the UK economy and more than 110,000 jobs supported.

Government officials and gambling regulators are caught in a delicate balance between raising crucial revenues—potentially up to £3 billion annually—and managing public health concerns related to gambling harm. Measures such as affordability checks have been phased in to mitigate problem gambling, which affects roughly 0.3% of the UK population. There is also a strong emphasis on funding anti-poverty initiatives, including support for vulnerable children. However, increased fiscal pressure risks pushing a significant portion of the market into unregulated channels, bleeding revenue and control from the UK economy.

For now, Entain appears cautiously firm in its stance that escalating taxes could reshape the landscape of UK gambling. While a relocation of its primary listing, akin to competitor Flutter's move to the United States, is not currently planned, David acknowledged such options remain on the table if the regulatory environment deteriorates. As the government prepares for the Budget, the gambling sector stands at a crossroads, with high street shops, sports sponsorships, and thousands of jobs hanging in the balance.

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Source: Noah Wire Services