UK to Raise Gambling Licence Fees 25% Over Operator Pushback

UK gambling operators face another increase in their cost of doing business. The government has confirmed it will raise Gambling Commission licence fees by 25% from October 1, 2026 — pressing ahead even though almost none of the operators it consulted supported any increase at all.

The Department for Culture, Media and Sport (DCMS) had put three options to the industry: a 30% headline rise, a 20% rise, or a 20% rise with an extra 10% ringfenced for tackling the illegal market. It rejected all three. Instead it landed on a flat 25% increase that will apply to most operating licences, personal licences, supplementary licences, single machine permits, and applications to vary a licence or change corporate control. The change will be brought in through secondary legislation.

Operators wanted no increase at all

DCMS received 47 responses, mostly from operators, suppliers and their representatives, and the verdict was close to unanimous. Almost all opposed every option on the table and argued for no rise whatsoever. Only two respondents backed the 30% option, none backed the ringfenced version, and just four of the 47 supported a 20% increase. Operators pointed to the cumulative weight of recent cost increases, singling out the changes to gambling duty rates and the statutory levy the sector now pays.

The government acknowledged the pressure but said an increase was unavoidable. The Gambling Commission is running annual budget deficits of around £4 million, and without more fee income its reserves would be close to exhausted. Holding fees flat — or even capping the rise at 20% — would force the regulator to cut or drop work it considers important. DCMS also leaned on a compliance argument: in 2025/26, around a quarter of its assessments on crime prevention and consumer protection found significant failings or pushed operators into special measures, which it says shows oversight cannot safely be scaled back.

Stacked on top of the tax rises

The fee decision lands while UK operators are still absorbing the steepest tax changes the sector has seen in years. The November 2025 Budget raised Remote Gaming Duty from 21% to 40% from April 1, 2026, and created a new 25% rate for remote betting from April 1, 2027, up from 15%. A statutory levy on operators, collected by the Commission to fund research, prevention and treatment of gambling harm, took effect in April 2025. Online casino operators carry the heaviest load on all three.

DCMS conceded that recent cost increases had created “a more challenging environment for operators,” but refused to phase the fee rise in over several years, arguing that licence fees remain a small share of revenue and that phasing would only add complexity. For the largest operators — those with annual gross gambling yield above £100 million — fees will rise from roughly 0.1% to 0.15% of yield.

The increase is also heavily weighted toward the biggest players. More than 1,100 smaller operators, those with annual yield below £10 million, will actually see their fees fall in cash terms. The cumulative burden has revived industry warnings that squeezed margins will push players toward the unlicensed market, even as rival jurisdictions court operators with cheaper licensing — Georgia is weighing international iGaming licences to rival Malta and Curacao, and Finland’s newly opened market drew 50 applicants in its first licensing round.

Who’s spared, and what comes next

Two groups avoid the full 25%. Society lottery fees will be frozen, which the government justified on the grounds that higher costs would eat into the money these lotteries return to good causes. And on-course bookmakers — the on-track operators covered by the general betting limited licence — will move to a model based on gross gambling yield rather than the number of days they trade. Under that change, DCMS said 44% of these operators would actually pay less, while a further 53% would see their annual fee rise by just £22.

That carve-out echoes the Treasury’s decision to shield horse racing from the duty rises, leaving the heaviest load concentrated on online casino and remote betting.

Although the 25% option carries no ringfence for illegal-market work, the Commission will build out its enforcement strategy using £26 million in extra funding promised by the Treasury over three years. Even with the higher fees, the regulator will still need to find at least £8 million in efficiency savings over the next five years. The government also signalled it wants to eventually hand the Commission the power to set its own fees, but said the legislation required to do that is not currently available.

For now, operators have until October to prepare for licence costs a quarter higher than today — the latest line in a year of rising bills the industry has spent months warning about.