After weeks of speculation in the gambling industry the UK’s 2025 Budget was announced by Chancellor Rachel Reeves, which delivered a mixed result for the British Racing Industry. While the government pushed forward with big tax rises on online gaming and most forms of remote betting it carefully carved horse racing out of those increases. It said it was keeping the betting duty on horseracing at 15%. The decision was confirmed in the Budget speech and in official guidance published on the 26th November 2025.
That ruling removes a prompt, direct hit to the sport’s primary income stream from offshore and online bookmakers. For many racecourses, owners and breeders the percentage of betting duty that flows back into the sport (through the Horserace Betting Levy and commercial partnerships) is material in turn keeping the racing rate unchanged eliminates an obvious short-term reduction in revenue tied to taxed turnover. It also means that the economics of the tote and bookmakers on-course will be left alone from further complications at a time when many venues are still navigating post-pandemic recovery.
But “no increase” does not mean no effect completely. The Budget announcement shows a much larger increase to remote gaming duty which will rise to 40% from 21% and then the online general betting duty will rise to 25% for remote betting from 2027. This will certainly reshape operators’ economics. Big gambling groups have warned that will mean lower profits so cost-cuttings will be made and with fewer marketing budgets. All of these can create knock-on consequences for the sport of horse racing because operators are major advertisers, sponsors and media partners for racing. If firms shrink marketing spend or renegotiate sponsorship deals the sport could see softer income in those channels even though its duty rate hasn’t increased.
Adding to the risk are behavioral patterns for customers. We feel that heavily increasing taxes on online casinos and non-racing sports bets may push some bettors towards less-taxed forms of leisure which includes unregulated markets or into product mixes that favour cheaper forms of play. Paradoxically, that could channel more punters into horse racing markets in the short term which would potentially boost on-course liquidity, in contrast reduce overall operator profitability and therefore reduce the money operators are willing to return to sport. The net result depends on how operators reprice markets, reshape product lines and also allocate marketing spend.
Finally, the Budget creates opportunity but also uncertainty. The exemption of tax increase gives racing breathing space to lobby for further protections such as the reform of the Horserace Betting Levy and to push for new commercial deals while competitor products face heavier tax. But the industry must also prepare contingencies for the potential impact with diversifying revenue, strengthening direct to fan engagement and lastly negotiate sponsorships that are less dependent on bookmaker balance sheets because it’s clear to see the wider gambling sector’s pain will leak through sports partnerships and media rights markets.
To conclude, we feel the Government’s 2025 Budget kept clear of hitting racing with a direct tax rise, which is a major and welcome short-term victory but the sport is not immune to knock on effects. The shape and scale of the domino impacts will be decided by operator strategies, sponsorship markets and punters behaviour in the months ahead.