The UK government has opened a consultation on potential increases to gambling operator licence fees, as regulators warn that current funding levels are no longer sufficient to meet growing enforcement and regulatory demands.
The consultation, launched by the Department for Culture, Media and Sport on 27 January, will remain open until 30 March, inviting views from operators, trade bodies, consumer groups, local authorities and members of the public.
Officials said additional funding is required to support the Gambling Commission’s ongoing work, particularly in tackling illegal gambling, delivering reforms linked to the Gambling Act Review and strengthening data and compliance capabilities.
“Since operating licence fees were last reviewed in 2021, the 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,” the consultation document said.
“As a result of this investment and additional pressures such as inflation, the commission has operated with successive annual budget deficits and has eroded its financial reserves.”
How UK gambling licence fees currently work
In the UK, gambling licence fees vary depending on the activity type, licence category and the size of the operator, with annual fees calculated using turnover-based bands.
Any changes agreed following the consultation would be applied proportionally to existing licence fees across all affected operators.
Remote casino operators generating more than £1 billion in annual gross gaming yield currently pay £793,729 per year, with an additional £125,000 charged for each extra £500 million above that threshold.
The same fee structure applies to operators offering remote sports betting and online bingo services.
Options proposed by the Gambling Commission
The first option outlined in the consultation, and the one preferred by the Gambling Commission, would introduce an average 30% increase in annual operating licence fees.
The regulator said this would close the gap between current income and the cost of delivering its statutory functions, generating an estimated £8.7 million in additional funding each year.
“This option would therefore provide the level of funding required to maintain our current work programme at a steady state, enabling it to continue to deliver its 2024 to 2027 corporate strategy and subsequent priorities,” the document said.
“However, this option does not include any growth for the Gambling Commission or investment in additional regulatory functions.”
Concerns over a smaller fee increase
A second option would see licence fees rise by 20%, although the commission warned this would still leave a significant funding gap over the coming years.
Under this approach, the regulator estimated it would need to find savings of £15.8 million by 2030-31, potentially including job losses.
“The commission would need to reprioritise its work, resulting in the slowing or stopping of some areas in order to focus its resources on its statutory duties and core regulatory activities,” the document said.
It added that enforcement efforts would likely focus only on the most serious cases, with a projected workforce reduction of around 10%.
Government-backed proposal and next steps
The government’s preferred option would also result in a 30% overall increase, but with 10% of that figure ring-fenced for targeted regulatory priorities.
This funding would be directed toward combating illegal gambling and strengthening enforcement, with around £2.6 million allocated to these specific initiatives.
“The funds would be used by the commission to ensure it is difficult to provide illegal gambling at scale to GB consumers,” the document said.
Following the consultation’s close on 30 March, responses will be reviewed before any decision is taken, with any approved changes expected to take effect from October 2026.
