UK government proposes Gambling Commission fee hikes

A consultation will assess three possible models to increase Gambling Commission fees.

UK.- The British government has opened a consultation on proposals to increase fees for gambling operators. The Department for Culture, Media and Sport (DCMS) has presented three possible models, all of which involve an increase in fees to be implemented from October 1 2026.

In the four documents available on the British government’s website, the DCMS says an increase in fees is needed to cover the Gambling Commission’s budget deficit. The consultation will run until 30 March.

The papers were briefly removed from the government website earlier today (January 27) and replaced with a message stating the information was published in error. However, they were subsequently reposted. It’s not clear if they were altered or if the publication was made earlier than planned.

The three options are:

• Option 1: A 30 per cent rise in annual licence fees
• Option 2: A 20 per cent increase in annual licence fees
• Option 3: A 20 per cent increase plus an additional 10 per cent earmarked specifically for tackling illegal gambling activity

The fee changes would not be applied uniformly since adjustments would depend on licence type, market share, and regulatory risk. General Betting Limited, External Lottery Manager, and Society Lotteries licences would see a flat percentage increase.

Application fees for operators and first-year annual fees, which are charged at 75 per cent of annual fees, are also expected to rise under any of the three scenarios. Personal licences and corporate application changes would increase by either 20 or 30 per cent.

Gambling Commission fee hike to balance books

The documents stress that since licence fees were last reviewed in 2021, the Gambling Commission has increased its investment in areas including disrupting the illegal gambling market, implementing reforms from the Gambling Act Review White Paper and developing its data capabilities. This has led to successive annual budget deficits and has eroded the regulator’s financial reserves.

In 2024 to 2025, the Commission used £3.1m of its reserves, and it’s expected that a further £5m will be drawn down in 2025 to 2026, taking the commission close to its minimum reserve level of £4m. Meanwhile, it’s expected that costs will continue to increase.

“Without a fee uplift in October 2026, the Commission’s reserves are expected to be completely exhausted during the 2026 to 2027 financial year,” the consultation document states. “The Commission plans to absorb some future inflationary pressures, but without an uplift it forecasts a deficit of £7m in 2027 to 2028, rising to £9.5m in 2030 to 2031.”

However, the timing of the proposed fee hikes are likely to prove controversial since the move will coincide with the increases in UK gambling taxes announced in the Autumn Budget in November. From April, remote gaming duty will rise from 21 to 40 per cent. General betting duty is set to rise to 25 per cent a year later in April 2027.

While some of the larger operators hope to absorb much of the increased costs, many are also making cuts. In December, Evoke, which owns William Hill in Europe, announced plans for a full strategic review and possible sale of individual units or its entire business.

Proposed changes to Gambling Commission funding framework

The documents also note that the current fees structure and fee setting approach has been in place since 2017, when the basis for the majority of licence fees moved to gross gambling yield (GGY). In 2021, remote fees were increased by 55 per cent and non-remote fees by 15 per cent to reflect the increased regulatory burden posed by online gambling.

However, the Gambling Commission notes that remote gambling revenue has continued to outpace retail and that income it receives some some types of licence has “drifted away from the actual costs of regulating them”.

The proposals would reset the income required per type of licence so it more closely reflects the cost of carrying out regulatory activities associated with that kind of operating licence.

Moving forward, the government intends to remove the current requirement for the Secretary of State for Culture, Media and Sport to implement gambling licence fee changes by statutory instrument. Instead, the Gambling Commission would be able to consult on its own proposals for fee changes and put the changes into effect. The DCMS notes that this would be similar to other regulators such as Ofcom and the Financial Conduct Authority, who have the authority to set fees themselves.