IGA Insights: Adapting to the UK Gambling Tax Changes

Part 1 - Where the Impact Hits First

On the 1st April 2026, the UK government implemented an increase on Remote Gaming Duty (RGD), affecting Online Casino and Bingo products. The tax for these products was initially set at 21%, but has now risen to 40%. Meaning a 19% rise in costs for UK facing Gambling Operators.

The changes to the UK Gambling Tax are expected to generate approximately £1 billion per year in tax revenue. The UK Government claims that the intention of the tax increase is to disincentivise gambling companies from pushing consumers towards what are considered more harmful products.

The duty increase does not apply to sports betting, where the tax remains at 15% until 1st April 2027, where it is then expected to rise to 25%. However, Horse Racing betting will not be impacted.

How the UK Gambling Tax Changes Impact Operator Profit Margins

The immediate effect of these changes has put pressure on Operator margins in the following ways:

1. Higher Costs

For UK-facing operators, the increase in Remote Gaming Duty directly reduces net revenue per player. This means that even if player activity remains stable, the margin generated from each customer is significantly lower, putting pressure on overall profitability.

2. Job Losses

As margins tighten, operators are likely to look for ways to reduce operational costs. Historically, this has often resulted in workforce reductions, particularly in areas not directly tied to revenue generation. Concerns around job losses were already raised following the initial announcement in late 2025, including comments from Per Widerström, the CEO of Evoke PLC.

3. Competition from Unregulated Competitors

In response to higher tax costs, some operators may reduce bonus spend or adjust RTPs to protect margins. However, this can make regulated brands less competitive when compared to unregulated operators, who are not subject to the same tax burden. As a result, there is a risk that some players may be drawn toward black market alternatives offering more aggressive promotions.

4. Tighter Budgets

With profitability under pressure, many operators have begun reviewing their spending strategies. While some brands have already reduced budgets, others are taking a more cautious approach. Marketing is often one of the first areas to face cuts, particularly in higher-cost acquisition channels, as operators look to maintain efficiency while controlling spend.

The Effect of UK Tax Changes on Affiliate Marketing Budgets

One of the most immediate ripple effects has been on marketing budgets, with affiliate partnerships being one of the first areas to feel the impact.

From an industry perspective, there is already a clear expectation that operators will prioritise margin protection over aggressive acquisition.

Tom Takar of Oddschecker.com shared his view on how operators may respond:

“In my opinion the UK’s upcoming gambling tax increases are expected to create meaningful short term pressure across the industry. With operators likely to prioritise margin protection through reduced bonuses and tighter promotional spend while being more selective of affiliate partnerships. Over the next few months, many brands will begin recalibrating acquisition strategies while shifting focus toward lower tax verticals and reassessing the profitability of existing deals.”

Tom Takar

From an operator perspective, this is already translating into real changes. Speaking with our own Senior Affiliate Manager, Debbie Blood, it’s clear that many UK facing brands have taken action for the month of April.

“In February and March 2026, I had to have some difficult conversations with affiliates… Due to significant budget cuts (over 33% for some UKGC brands) we had to pause several long-term relationships. For the remaining accounts, deals were reduced by 30%”

Debbie Blood

These insights highlight a consistent trend, in that affiliate marketing looks set to shift away from scale and more toward efficiency. As these changes continue to unfold, it is more important than ever to understand how different strategies perform across different traffic sources.

Adapting to the UK Gambling Tax Changes

In part two of this series, we’ll break down how leading UK operators are reshaping their affiliate marketing strategies, including where budgets are being cut, where spend is being reallocated, and which traffic sources are seeing the biggest impact.

At iGaming Affiliates, we work closely with a range of UK-facing brands, giving us direct insight into how operators are adapting their strategies in response to these tax changes.

In the second part of this series, we’ll explore the specific strategies being implemented and take a deeper look at how different traffic sources are being impacted.

If you’d like to learn more about how we can help optimise your affiliate programme, get in touch with our team.

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