Flutter warns earnings could be hit by Budget gambling tax shock

Paddy Power And betfair Owner Flutter Entertainment has warned the government Budget The move to increase gambling taxes will reduce its annual income by millions of pounds over the next two years.

chancellor It was announced on Wednesday that remote online gaming fees will increase from 21% to 40%, while online sports betting – excluding horse racing – will increase from 15% to 25%.

Flutter – which also owns Betfair, Sky Bet and FanDuel in the US – said the tax raid would hit its underlying earnings by about US$320 million (£241.7 million) in 2025-26 and US$540 million (£407.9 million) in 2026-27.

It hopes to reduce this loss by 40% by 2027 through cuts in promotional and marketing spending and broader cost reduction efforts.

kevin harringtonFlutter’s UK and Ireland chief executive said the tax increase was “a very disappointing outcome and will have a significant adverse impact on our industry”.

“The Chancellor wants to address harm in the right way, but these changes will give big wins to illegal, unlicensed gambling operators who will become more competitive overnight.

“These black market operators do not pay taxes and do not invest in safe gambling.

“At 40%, the UK remote gaming levy is now well above countries such as the Netherlands, where recent tax rises have seen a rise in illegal gambling and a fall in government receipts.”

He added that the firm is “well placed to navigate the changes” “through our scale and leading position in the UK, as well as the proactive cost initiatives we are undertaking”.

The share price of some gambling stocks fell sharply on the London market on Wednesday after the tax hit, with William Hill owner Evoque falling 18% and falling down the ranks after its post-Budget earnings fell by almost £40 million.

Rank said the impact on its online gaming business would be partially offset by the benefits from bingo fee abolition, adding that it was “reviewing various mitigating actions for the UK digital business in the context of our profitability, investment plans and competitive landscape”.

Other gambling firms with more global operations were spared the worst of the share price decline.

Flutter, which moved its primary listing from London to New York last year, saw its shares gain in London, while Ladbrokes rival Enten, which also has a more diversified global exposure, pared early losses and closed higher.

The Chancellor avoided any tax increases for the industry for in-person gambling or horse racing in the Budget after warning that jobs in the industry would be hit, while he said bingo fees would be completely abolished from April next year.