Government proposals to harmonise the tax rates for online betting and gaming could threaten the financial future of British horseracing, potentially costing the sport tens of millions of pounds annually. The plan, currently under consultation, suggests aligning the current 15% Remote Betting Duty (RBD) for online sports betting with the higher 21% Remote Gaming Duty (RGD) that applies to online casinos and slot games. While the consultation does not specify a new rate, it is widely assumed that the harmonised rate will not fall below the existing 21%.
Industry leaders are deeply concerned about the potential consequences of this change. They argue that harmonising the rates would remove incentives for gambling operators to invest in horseracing products and could ultimately make the sport less attractive to punters. Betting on horse racing, unlike online gaming, is seen as an activity that involves thought, skill, and a dynamic interplay of odds and margins. Gaming, on the other hand, is largely mechanical and designed to ensure consistent profits for operators.
If implemented, the harmonisation could reduce customer offers and promotions tied to racing, increasing the likelihood that consumers will seek better value in unregulated, illegal markets. This shift would not only hurt the regulated betting industry but could also expose consumers to greater risk of gambling harm, particularly from addictive online gaming formats like slots and roulette.
Economic modelling commissioned by racing authorities has projected significant losses under the proposed tax alignment. A move from 15% to 21% could see the racing industry lose around £40 million annually. If the rate were to rise to 30%, losses could approach £90 million. Such a blow would severely affect the sustainability of horseracing, an industry estimated to contribute over £4 billion to the UK economy and support around 85,000 jobs.
The distinction between betting and gaming has always been reflected in tax policy. Betting, particularly on horse racing, is seen as a complex, competitive, and culturally significant activity, unlike the repetitive nature of online gaming. Attempts to simplify taxation by merging these two distinct categories risk undermining that understanding.
There is also a broader social concern. Online gaming products, especially slot machines, have been widely recognised as more harmful, with a higher risk of addiction. Some policy voices have argued not for harmonisation at 21%, but for an increased rate on gaming to better reflect the potential harm, while maintaining the lower rate on betting. This approach would acknowledge the different nature and risks associated with each form of gambling.
The push to combine duties into a single Remote Betting & Gaming Duty (RBGD) may appear administratively efficient, but critics argue it overlooks the complexity of the gambling ecosystem. Racing has a uniquely symbiotic relationship with betting, and flattening the tax structure could have unintended consequences that ripple through rural communities and local economies reliant on the sport.
As the consultation process continues until July, stakeholders in horseracing are rallying to make their voices heard. The hope is that policymakers will recognise the value of maintaining a tax regime that supports a vital national industry and protects consumers from the growing risks of online gaming.
