Labour considers £3bn gambling tax under 'polluter pays' proposals

Ministers are considering a tax raid of up to £3bn on the gambling sector as Rachel Reeves casts around for funds to shore up the public finances.

- Rob Davies

Treasury officials are understood to be weighing up proposals, put forward by two influential thinktanks and backed by one of the party's top five individual donors, to double some of the taxes levied on online casinos and bookmakers.

Measures could be included in this month's budget, Labour's first in 14 years, as the chancellor tries to plug the £22bn "black hole" that she claimed to have found in the nation's finances after taking office.

Sources familiar with the discussions said the Treasury had yet to make a decision but appeared receptive to tweaking the UK's complex regime of betting and gaming duties to raise extra funds of between £900m and £3bn, despite opposition from industry lobbyists.

The call for higher taxes on the £11bn-a-year sector is backed by Derek Webb, a former poker player and casino game inventor, who has funded campaigns for stricter regulation of the gambling industry.

Webb has given £1.3m to Labour since the start of 2023, making him the party's fifth-largest individual donor during that period.

One of the tax plans that Treasury officials are looking at comes from the left-leaning Institute for Public Policy Research (IPPR).