Question proposed, That the clause stand part of the Bill.

With this it will be convenient to consider the following:

Clauses 84 and 85 stand part.

Schedule 13.

New Clause 21—Review of the impact of sections 83 and 84: free bets and freeplays—

“The Chancellor of the exchequer must, within six months of the passing of this Act, undertake an assessment of the impact of implementation of sections 83 and 84 of this Act in respect of the treatment of free bets and freeplays for calculating general betting duty on remote bets.”

New clause 25—Statements on increasing remote gambling duty and introducing a new rate of General Betting Duty—

“(1) The Chancellor of the Exchequer must, within six months of this Act being passed, make a statement to the House of Commons on the effects of the increase in gambling duties made under sections 83 to 84 of this Act.

(2) The statement made under subsection (1) must include details of the impact on—

(a) sports and horseracing,

(b) the number of high street betting shops,

(c) the gambling black market,

(d) the employment rate, and

(e) the public finances.”

This new clause would require the Chancellor to make a statement about the effects of the increase in gambling duties.

Clauses 83 to 85 and schedule 13 make changes to the gambling duties regime, to better reflect the modern gambling market and to raise more than £1 billion a year to support the lifting of the two-child benefit cap. I will first speak briefly to the broader context of the package, and I will then turn to each Clause.

Gambling is a significant part of the UK economy, generating an annual gross gambling yield of around £16.8 billion in 2025, according to figures from the Gambling Commission. The industry has changed markedly in recent years, while the duty system has not changed since 2019. Most notably, there has been a structural shift from in-person to online gambling. Between 2015 and 2025, remote gambling grew by 80%, while land-based gambling has declined by 10%. At the same time, evidence of gambling-related harms has become even clearer.

The estimated cost to the Government and society of gambling-related harms in England alone is between £1.05 billion and £1.77 billion a year. NHS figures show that over 40% of gamblers using online slots, bingo or casino games are considered to be at risk, compared with less than 15% of those betting in person on horseracing. Referrals for gambling addition have risen sharply—NHS England has doubled the number of clinics for problem gambling. I am grateful for representations from so many MPs and campaigners on this matter, alongside those with constituencies where horseracing plays an important role in the community and, indeed, the local economy.

In the Budget, the Chancellor made it clear that changes to gambling taxation are fair, proportionate and for a purpose, as they will directly contribute to lifting an additional 450,000 children out of poverty. This Government are very proud of that. Unfortunately, the Opposition showed little regard for child poverty when they were in government, and it is entirely in character, albeit no less shocking, that they oppose this Government’s changes and would increase child poverty as a result. Reform UK is even more brazen.

The tax changes in the Bill disincentivise the most harmful forms of gambling. We have also introduced a statutory levy to pay for the prevention of some of those harms arising in the first place, and of treatment, and my hon. Friend makes an excellent point.

My hon. Friend makes a good point. NHS figures show that over 40% of gamblers who use online slots, bingo and casino games are considered at risk, compared with less than 15% of those who bet in person on horseracing, so that is an important contrast, and the NHS figures bear that out.

Reform UK’s position on the two-child cap is even more brazen. The party went into the election promising to scrap the two-child limit but has now abandoned that position, and its Members will be traipsing through the Division Lobby with their ideological bedfellows, the Conservatives. Indeed, on any given day it is hard to keep track of who is supposed to be sitting on the Conservative Benches, and who has moved to the Reform Bench.

The right hon. Member raises a good point, as did my hon. Friend Gareth Snell, about the illegal market. We are reassured by the fact that the illegal betting market in the UK is relatively small, representing between 2% and 9% of legal online market stakes. The Gambling Commission is already tackling this risk and seeking to protect consumers. The additional £26 million that we will provide to the Gambling Commission over the next three years will go to better and further enforcement against the illegal market in this space. I hope that reassures him.

At the autumn Budget 2024, the Government announced a consultation on modernising the tax treatment of remote gambling, including a proposal for a single duty covering all remote betting and gaming. The consultation ran from April to July 2025. Respondents strongly opposed a single duty, arguing that remote betting and gaming significantly differ in operating costs and harms. The Government have listened to those concerns and are not proceeding with a single remote betting and gaming duty. Instead, the Bill implements a targeted package of rate changes that will raise over £1 billion a year. It focuses on remote gambling, which has grown significantly, it protects UK horseracing and it supports lower risk community-based activities by abolishing bingo duty.

I will now turn to the individual clauses in the Bill. The changes made by Clause 83 will increase the rate of remote gaming duty, which applies to online games such as slots and roulette, from 21% to 40% on 1 April 2026. Remote gaming has relatively low operating costs and has grown rapidly in recent years, with gross gambling yield rising significantly above inflation, from £2.5 billion in 2015-16 to £5.2 billion in 2024-25, based on Gambling Commission figures. It is associated with higher rates of gambling-related harm, relative to other products. As we have discussed, NHS data shows that online slots and casino games have much higher proportions of problem gamblers than betting on sports, for example. By increasing the rate on remote gaming more significantly, this measure intends to reduce the incentive for operators to push customers towards higher harm products.

Clause 84 will increase the rate for remote betting. General betting duty is currently charged at 15% for both remote and in-person betting, but the betting market has changed significantly in how it operates. Clause 84 will create a new, higher rate of general betting duty that will apply to bets placed remotely, such as online sports bets, from 1 April 2027. The new remote rate will be set at 25%, while the existing 15% rate will continue to apply to bets placed in person in licensed betting premises. The new 25% rate will not apply to remote bets on UK horseracing. Those bets will remain taxed at 15%, in recognition of the fact that operators already pay the 10% statutory horserace betting levy on horseracing bets, creating a de facto 25% burden when the 15% levy is taken into account. The new remote rate will also not apply to bets placed via self-service betting terminals in UK-licensed betting premises, pool bets and spread bets.

Finally, clause 85 will abolish bingo duty, which is currently charged on the gross gambling yield from bingo, including in dedicated bingo halls. Bingo is a much lower-risk and community-based form of gambling, often providing an important social outlet, and it supports local venues, including around 250 bingo halls right across this country. Clause 85 and the associated schedule 13 will abolish bingo duty with effect from 1 April 2026. The Bill also makes consequential changes to ensure that bingo played in UK licensed bingo halls does not become liable to other taxes or duties as a result of that abolition. This Government know the importance of bingo halls in our communities, and we are proud to back them with this tax change.

I confess to my hon. Friend that I will need to write to her on that specific issue, because I do not have notes in front of me to that end. We are on the same page in terms of the principles she raises and the values that she seeks to put forward, and I welcome her welcoming of this Bill.

Taken together, clauses 83 to 85 modernise the gambling duties regime. As I said, they raise more than £1 billion a year to support public services and lift children out of poverty. They also focus tax increases on higher-harm, fast-growing online products while protecting UK horseracing and land-based betting and supporting bingo halls.

My hon. Friend raises an important point around jobs in the industry. He will be aware that employment in the gambling industry as a whole declined by around 20% between 2015 and 2023, so it is in gradual decline, and the trend predates this Bill. The jobs in his Constituency are incredibly important, which is why the measures in this Bill deliberately focus on online gambling, rather than betting shops and casinos, which support more jobs and face higher operating costs, as I am sure the institutions in his constituency do.

As I said, employment is an important consideration that has been borne in mind for the purposes of this Bill, and there has been considerable engagement on all these issues. If the right hon. Member seeks further engagement, I am more than happy to have it.

I was just about to conclude.I commend clauses 83 to 85 and schedule 13 to the Committee.

I call the Shadow Minister.

These changes were presented as some sort of simplification and modernisation, but clauses 83 and 84 nearly double remote gaming duty from 21% to 40% and increase general betting duty to 25%. We will have some of the highest rates of tax on gambling in the world. As we have heard from some Members, the industry has warned that that could have severe consequences for an internationally competitive sector that supports tens of thousands of jobs, underpins horseracing and other sports and already contributes significantly to the Treasury. It is questionable whether these measures will lead to stable, long-term revenue gains for the Exchequer, and there is a very real risk that they will result in job losses and greater use of unregulated operators in the black market. New Clause 25 would require the Chancellor to come back to the House and explain what the consequences have been for revenue, sports and horseracing, high street betting shops, the black market, jobs and the public finances.

Of course, the origin of these changes owes much to Gordon Brown, who encouraged the Chancellor to hike taxes in order to increase welfare spending. Proponents of higher taxes often suggest that they will not have any consequences, but it is the role of us in this House to scrutinise potential changes and assess the impact after the event. Independent modelling from EY shared by the Betting and Gaming Council suggests that the impact of doubling remote gaming duty could be the loss of 15,000 jobs, and a further 1,700 jobs could be lost as a result of the increase in general betting duty. In total, 17,000 positions located in Stoke-on-Trent, Leeds, Sunderland, Manchester, Nottingham, Newcastle-under-Lyme, Norwich and other areas could be affected. Of course, those are simply projections—they could prove to be pessimistic, and we certainly hope that will be the case—but when unemployment has risen consistently under this Government due to the jobs tax and other costs, such warnings should not just be dismissed. That is why the Chancellor must account for the impact of her choices, as new clause 25 requires.

There has been some mention of horseracing. I was pleased to join colleagues across the House in support of the “Axe the Racing Tax” campaign. That is another tax that the Chancellor wanted to introduce, but she was forced into one of her all-too-regular U-turns.

We are debating the measures in this Bill, which was introduced by this Government. I was not involved in the changes that the hon. Gentleman refers to, and I certainly would not have supported hitting the horseracing sector in the way that was proposed. I do not remember that being in a previous Finance Bill introduced by a previous Government; it is this Government who sought to bring forward those measures, but they were roundly rejected, because horseracing supports around 85,000 jobs and contributes £300 million in tax revenue every year.

Despite the Government’s climbdown in exempting horseracing from the higher rates, the industry could still feel the consequences of this Government’s approach to gambling duties. When the online betting sector is squeezed, sponsorship is likely to be reduced, and because racing’s funding depends heavily on those partnerships and that sponsorship, we could see an impact on racing. In my area of Norfolk, we are very fortunate to have Fakenham races—I went there to support the British Horseracing Authority’s campaign against the Government’s plans. That venue is synonymous with the area and its identity, and is a source of local employment, not just at the track itself but for the farriers, the pubs, the hotels and the whole ecosystem that supports racing. That is why these clauses in the Bill continue to pose a risk to the sector and other sports, and that risk needs to be accounted for.

I now turn to the black market, an issue that was raised by Gareth Snell and my right hon. Friend Sir Gavin Williamson. The Government have acknowledged the risks associated with taking this approach, which is why they quietly set aside £26 million for the Gambling Commission to combat expansion of the black market, but the same EY analysis suggests that over £6 billion in stakes could migrate to the black market, doubling its current size and undermining the progress that has been made through the existing regulatory framework. The Office for Budget Responsibility has identified potential leakage of around £500 million in lost revenue as activity shifts away from properly regulated markets. Those projections—which again could be wrong, but could also be right—raise legitimate questions about the overall effectiveness of the Government’s approach.

When taxes rise too far, behaviour can change and the yield can go down, which is what we will see with a number of the tax rises that the Government have included in their Finance Bill. Rather than reducing demand, activity will move to unregulated markets where consumer protections are weaker, fraud risks are higher, and tax revenue is not collected. I am not sure we have heard a convincing response from the Minister about how that will be addressed and whether those risks have been taken properly into account.

Let us look at what happened in the Netherlands, where the Dutch Government raised their remote slots tax rate to 34% last January. Within months, gross gaming revenue fell by a quarter and gambling tax receipts dropped to just 83% of the previous year’s figure, leaving a €200 million shortfall from the projections. Somewhat predictably, the Dutch regulator then reported a huge growth in the number of people accessing unlicensed domains, rising from 200,000 to a million. That should serve as an example of why we should be cautious about the Chancellor’s plans. Experience suggests that changes have unintended consequences, and those risks must be carefully assessed. In winding up, will the Minister provide a bit more clarity about how that will be monitored and what steps the Government will take if there are unintended consequences and those projections prove to be accurate?

There is some debate and confusion in the sector and some of the professional bodies about the treatment of free bets and free plays. The sector and those bodies have raised concerns about that. The Budget costings document calculates gambling duty using the gross gambling yield, which is the revenue retained by operators after paying out winnings to customers. However, current law uses a wider measure, which also counts the value of free bets and free plays. That means there is a potential mismatch. Will the Minister clarify that? I am sure she has had representations on it directly.

We need to strike a balance with the levels of taxation. The industry is warning that these increases will impact on sports and lead to job losses and more black market activity. New Clause 25 seeks transparency and an answer to those concerns. It asks the Chancellor to assess the impact of these rises on horseracing, the black market, jobs and the public finances. That is the minimum that Parliament should expect, and I hope Members will support our new clause.

I rise to speak to clauses 83 to 85 and schedule 13, which respectively outline: an increase in tax on online gaming, such as online slots or casino games; a new rate of general betting duty specifically for online betting, such as placing a bet on a football match; and, removing bingo duty.

Online gambling has evolved quickly, and legislation has simply not kept up. Before, someone might have popped down to their local high-street betting shop or organised a trip with their friends to the casino. It was confined to a specific place that people had to go to and then at some point leave. That does not mean that there were no problem gamblers—of course there were—but it did impose necessary social and physical limits on gambling. Online gambling has changed that beyond all recognition. Now, that casino fits into someone’s pocket. Online platforms know people’s habits, when they use their phone most and when they have not gambled in a while, and the platforms can tailor notifications to pull people back in. The technology is designed to prey on human instinct, using algorithms that make betting time-sensitive, compulsive and constantly available. In case the opportunity to gamble ever slips someone’s mind, gambling companies will be sure to remind them in a commercial break for sports matches, on the side of buses and emblazoned on the microphone at premier league post-match interviews.

People might see some of the seemingly generous offers they are given. For their first £5, the betting companies might give them £100 or even £200 credit to gamble with. That feels like a lot of money to most people, but it is pennies compared with what the companies are making from their current customers and what they might make from you, once you are hooked.

As someone who, to be frank, does not like gambling—I do not gamble, and I do not understand why people enjoy handing their money over to betting companies—I detest the tactics used by gambling companies to pull people in. As online gambling has evolved exponentially, the online platforms have been able to get away with dodging responsibility for problem gambling or for paying their fair share into the Treasury. As my dad always says, “You never meet a poor bookie.” That is why I support Clause 84, which will introduce a new higher rate of tax on remote betting, so that online bets are more expensive compared with in-person betting. Those taxes will be paid by the platform, so that we can catch up, finally, with the reality of the gambling world, which has moved far beyond the traditional model of shops and casinos that the tax system was designed around.

Clause 83 raises the rate of remote gaming duty, the tax on online slots and casinos. That reduces the incentives for operators to push the most harmful forms of online gambling, making the system fairer and safer for everyone. I represent Morecambe, a seaside town with a host of gaming businesses on the front and a bingo hall. The evidence shows that it is not the penny slots or the weekly bingo games that drive the Majority of problem gambling, and I am pleased that the new remote gaming and betting duties recognise that.

A focus on the evidence base is clear from the Government’s responsiveness to feedback from the consultation on gambling, in which it was shown that different forms of gambling carry different levels of harm and, of course, costs to operate. Instead of imposing a flat rate across the sector, this Government will be taking a more nuanced approach, imposing the highest rates on remote gaming, which carries the biggest risk of harm, while protecting lower-harm forms of gambling such as the local bingo hall. Part of the revenue raised will go into research on, prevention of and treatment of gambling harms. That replaces a voluntary system that some operators exploited, contributing as little as £1 a year. The new levies will take into account differences in operating costs and the different levels of harm across gambling activities. It is estimated that £810 million will be generated from these measures in 2026-27, rising to £1 billion by 2030-31. This is money that, as well as tackling gambling harms, can go into our NHS, our social care and our schools. People will still be free to gamble if they choose, but these measures discourage the most harmful forms of online betting and gaming, while supporting lower-risk, community-focused activities. The abolition of bingo duty supports that too, as well as protecting jobs and local social spaces. This measure is informed by Labour values.

We have a long-standing principle that the polluter pays. In this instance, online gambling platforms are polluting people’s lives, harming their health, draining their wealth and breaking up families. This must end, and clauses 83, 84 and 85, along with schedule 13, will go some way to achieving that.

I call the Liberal Democrat spokesperson.

We Liberal Democrats have long campaigned for the doubling of remote gaming duty, and we are grateful to the Government, who have finally listened and taken that on board. This measure will raise vital revenue in a fair way, while addressing the eye-watering profits of the big online gambling companies and standing up for the thousands affected by problem gambling. According to the latest figures from the Gambling Commission, the online gambling giants saw revenues reach an eye-watering £7.8 billion in 2024-25. Meanwhile, Public Health England has estimated that gambling costs the UK economy about £1.4 billion a year through a combination of financial harms and the impact on physical and mental health, employment, education and crime. About 300,000 adults in Britain experience problem gambling, as well as roughly 40,000 children. Those figures are stark. This measure finally takes action that should have been taken a long time ago, and it will raise about £1.8 billion a year by 2029-30 to fund our public services fairly.

Buried in the fine print, however, is a detail that makes it seem as if the Government are giving the big online gambling firms a get-out, and I should be grateful to the Minister for some clarification. According to the “Budget 2025 Policy Costings” document,

“The tax base for this measure is the Gross Gambling Yield”,

which is the revenue retained by gambling operators after they have paid out winnings to customers. The tax base for remote gaming duty as defined in the Finance Act 2014 is a larger tax base. It is known as the gross gambling revenue, and includes the notional stake value of free bets and free plays. Can the Minister explain why today’s tax measure will apply to a narrower tax base than the one currently targeted by remote gaming duty? How much tax revenue has been forgone by this narrowing of the tax base? Was it unintended, or was it a result of influence from the sector? Did any of the big online gaming companies meet any Ministers and discuss these measures while they were being considered?

New Clause 21, tabled in my name, seeks to clarify this situation by requiring the Chancellor, within six months of the passing of the Act, to undertake an assessment of the impact of the implementation of sections 83 and 84 in respect of the treatment of free bets and free plays for calculating general betting duty on remote bets, so we can clearly see the impact of this difference.

I want to speak in support of clauses 83 and 84 on gambling taxation. I of course strongly welcome these steps on remote gaming duty, which cover online slots, online casino games and other high-risk remote gambling products.

Ahead of the Budget last year, I was one of more than 100 Labour MPs, alongside Gordon Brown, who wrote to the Chancellor calling for a different approach to gambling taxation and one that recognises the reality of the modern gaming industry. We highlighted how taxing the social ills caused by online gambling could pay for the abolition of the two-child benefit cap, and I strongly welcome the action the Chancellor has taken to lift hundreds of thousands of children out of poverty on the back of these changes. For us, fairness was not just about asking those with the broadest shoulders to contribute more, but about ensuring those whose business models generate the most harm make a proper contribution to the cost of that harm. That is why Clause 83 is so important, as it targets the most addictive and dangerous forms of gambling: online slots and casinos.

As a country, we are experiencing record levels of harm caused by gambling. The Gambling Commission’s figures tell us that 2.5% of adults, which is more than 1 million people, are suffering from serious gambling harm. There are many types of gambling harm—debt, family break-up, crime and, at the most severe end, suicide—so it is extremely worrying that the Royal College of Psychiatrists has seen a threefold increase in the number of those referred for gambling treatment since gambling moved online during the pandemic.

In my own area, the Dudley-based Gordon Moody charity, which provides gambling treatment centres all over the west midlands, has seen a large increase in referrals, most worryingly among younger people involved in online gambling. This is not a coincidence, because online slots and casinos are designed to be high speed, continuous, psychologically manipulative and, for many, overwhelmingly addictive. So the Chancellor’s decision to increase remote gaming duty targeted at these most harmful forms of gambling is absolutely the right thing to do. It sends a clear message that the tax system must reflect the level of harm caused.

There is another reason why this change—as well as clause 84, which increases general betting duty—is the right thing to do: many online gambling operators, particularly large global operators, have spent years offshoring their profits, booking revenues overseas, minimising their UK tax liabilities and contributing very little in meaningful employment or investment in our communities. In one example, at the end of last year the online operator Sky Bet moved its headquarters to Malta specifically to avoid UK corporation tax, cutting its contribution to the Treasury by tens of millions of pounds. In another example, an unnamed online bookmaker was investigated by the Gambling Commission for illegally directing customers to offshore-based platforms —indeed, to the black market itself—to avoid paying UK tax and to avoid UK regulations. Increasing these online duties means that it will be harder for unscrupulous operators to avoid tax by moving operations offshore. Online gambling in the UK will be taxed fairly in the UK.

Raising remote gambling duty to 40% and general betting duty to 25% for remote bets also puts us on a footing much closer to that of other European jurisdictions and many states in the United States. Until the Budget, the UK was behind the curve in taxing these highly harmful online products. For us, the Chancellor’s move is a matter not just of revenue, but of fairness, responsibility and aligning our tax system with the reality of modern online gambling.

However, taxation is only one element of harm reduction. Raising duty alone will not of course prevent gambling addiction, stop children being exposed to online gambling advertising and ensure that families receive the support they need when a loved one falls into crisis. If we are to tackle these harms, we need a public health approach. That means proper funding for treatment, and I welcome the steps already taken under the statutory levy. However, it also means serious investment in prevention, community education and early Intervention, and a modern regulatory framework that puts people, not profits, first and is fully independent of the gambling industry.

I want to highlight another pressing issue for the Minister, which is the continued prevalence of the B3 gaming machines on physical premises. These high-intensity machines, so often located in areas with higher deprivation, continue to cause significant harm, yet they remain under-regulated and undertaxed relative to the risks they pose. If we are to take harm seriously, B3 machines should be included in the next phase of gambling tax reform.

Finally, the most recent gambling Act was introduced more than 20 years ago, in a completely different era: before the smartphone, before the explosion of data-driven behavioural targeting, and before 24/7 online casinos in your pocket. A new Act is clearly needed. Our Laws have not kept pace with technology, they have not kept pace with the scale or sophistication of online gambling operators, and they have not kept pace with the reality of the harm we now see every day in communities across the country. I welcome the measures in the Bill, but I urge the Government to move quickly to update advertising rules, strengthen affordability checks, protect children and vulnerable people, and ensure that tax policy, regulation and public health strategy on gambling are all aligned.

The measures on remote gaming duty and general betting duty are excellent steps in the right direction. They acknowledge the reality of harm, strengthen fairness in our tax system and take us closer to a modern framework that puts the wellbeing of the public first.

I call the Chair of the Culture, Media and Sport Committee.

I would like to speak in support of new Clause 25, which would require the Government to assess the effects of an increase in gambling duty, because just as I believe individuals have a right to spend their hard-earned money as they like, I believe it is important that they do so in a sensible, regulated and safe environment.

Whatever we may think about gambling companies, gambling is already a very heavily regulated sector. Since the gambling white paper was published in 2023 by the previous Government, the industry has already absorbed over 62 policy changes. Those changes include a limit on slot stakes, financial risk checks on transactions, tightened market rules and the statutory levy. The sector is so well regulated that the Culture, Media and Sport Committee warned the previous Government that the finance risk checks should be as minimally intrusive as possible. The Committee concluded that the Government must strike a careful balance: preventing harm for all, while allowing those who gamble safely the freedom to continue to do so. I have concerns that this vast increase in taxation on online betting and gaming does not strike that balance.

The combination of an existing regime of strong regulation and a sudden jump in the levels of remote gaming duty from 21% to 40% is the kind of environment that I believe risks pushing people into the black market. As a floor, 40% is very high for remote gaming tax by international standards. It has been suggested that such high taxes could double the size of the online black market. Does the Minister recognise research from the Netherlands, highlighted by the Shadow Minister, which found that after steep tax rises were introduced on remote slots, visits to black market domains increased fivefold over a three-year period? That is what we have to worry about if we are concerned about the oversight of those making bets and playing slots. That is why I am supportive of new clause 25, tabled by the Opposition. It requires the Chancellor to assess and report back on the effects of the increase in gambling duties on the number of high street betting shops, the black market, the employment rate, the public finances, and sports and horseracing.

On sports and horseracing, I was glad to see a carve-out from general betting duty for UK horseracing. I was among many Members calling for that in recognition of the unique place horseracing occupies in British cultural life, as well as the 85,000 jobs and £4 billion contribution to the economy that horseracing offers.

The Government have slightly dressed up their raid on gambling companies as being driven by concerns around gambling harms. In November 2024, I spoke to the Bacta convention about the then recently announced statutory levy and my concerns about how it would be distributed to organisations that conduct harms research. The Committee recommended the year before that the Government ensure that service providers, which were operating via the voluntary funding system, were adequately supported to make the transition to the statutory levy. However, we have now received very concerning reports that voluntary organisations in particular are facing a funding cliff edge, with delays and a lack of information about the transition to levy payments from the NHS.

I am not entirely sure the Minister is listening to what I am saying, but I am hoping she will be able to address that point. She has not looked at me once while I have been speaking, but hopefully she is furiously writing notes about what I am talking about and will be able to address those concerns. Hopefully, she will tell me that she will discuss them with colleagues and act to ensure that no charitable organisation currently operating within the gambling harm prevention sector will have to fold due to delays with levy funding.

The Chancellor is looking around for money and believes that she can raise it from gambling companies, but, as with many of her other measures, such as national insurance rises, she will be a victim of the law of unintended consequences if she is not careful. On this occasion, the consequence will be that more people are dragged into the black market, where they will quite simply find better offers than those offered by gambling companies.

The black market is completely unregulated. There is no maximum stake limit, and there are no financial vulnerability checks, deposit limits, prompts or transparent spending summaries. Having taken the opportunity to speak with many who have been impacted by problem gambling—in some cases, families who have been impacted in the most substantial way, as their relatives have taken their own lives—I can say that the black market is a wild west that any vulnerable person could easily be drawn into. These measures could represent a one-way ticket to that town. The Government already recognise that in their own statistics. As the Minister said, they are earmarking an additional £26 million for the Gambling Commission to investigate the issue, so clearly they recognise that it is a problem that needs to be kept an eye on.

This is really important. While the Chancellor believes that she is potentially pocketing a cool £1.1 billion from this increase, there is a risk that in reality she will lose out on the tax receipts from up to £6 billion diverted back to the black market. She might think that she is the winner, but in actual fact, under her watch we will all be losers.

As has already been pointed out by a number of colleagues, my Constituency is home to bet365. My hon. Friend Alex Ballinger said something about there being no meaningful employment in gambling, but I would say to him that there are thousands of people in my constituency and in that of my hon. Friend Adam Jogee, who put food on the table for their children as a result of the job they do in the industry. There are 109,000 people who go to work in the sector, whether it be in a betting shop, a casino, a bingo hall, or a high-tech company like the one in my constituency. To say that the work is not meaningful makes this sound like an ideological change rather than a taxation change.

That is nonsense, frankly. Some 7,500 people work for that company in my Constituency. If they were all my constituents, that would mean one in 10 people in my constituency were getting paid a salary that is greater than the average for the region. Whether we like gambling or not, that company and the people it employs are driving the economic regeneration of north Staffordshire, because those jobs are the ones that give people money to spend on our services, shops and social activities.

I am sure we do not want to make this a debate about the moral rights and wrongs of gambling—that is not the nature of the debate we are having today—but I do think we need to consider the reality of the circumstances that the communities that host these companies will face as a result of the tax changes. I congratulate my hon. Friend the Member for Halesowen on being successful in his campaign to get to where we are today, but the consequence is going to be felt in my constituency with job losses. There are people who will not have a job this time next year, either because the company that they work for will have to reduce the number of people who work for them, or—worst of all—will move overseas.

There have been lots of comments about moving profits overseas and the prospect of bad actors, but the company in my constituency is probably an exemplar of how to keep the money in the UK. The owners of the company are paid incredibly well, but they still pay PAYE. They make a contribution to the state that is about equal to my entire local government budget. The idea that these are not meaningful organisations is slightly disrespectful to the people in them, and the economic damage that would occur in my city if such companies were to disappear overnight, which they could do, would be devastating. Frankly, it would cost the Government significantly more in the bail-out that would be needed than they would raise through the tax.

I think it was my hon. Friend Jim Dickson who made the point that we do not do hypothecated taxes in this country. When it comes to spending, I support every measure that the Government brought forward at the Budget. The lifting of the two-child benefit cap will benefit 4,500 people in Stoke-on-Trent Central. My city has one of the highest rates of child poverty of anywhere in the country, so the benefit to those families will be enormous and immediate. However, everything goes into one big pot and then goes out from the other pot, and we should be careful about making the moral argument that specifically taxing gambling is the only possible way to fund how we deal with child poverty. That is a slight misapprehension.

Having visited bet365 and seen the work that it does, I know that it is worried about the impact that the changes will have on the black market. It—as does the entire sector—spends a lot of its time and energy doing research and development to try to work out how to keep people playing and betting in the regulated sector, where there is support for people at risk from gambling, including lock-out mechanisms for problem gamblers, and where the tax receipts from the people who bet go back into the UK. To have £6 billion going into the unregulated sector could be a huge loss to the Treasury.

We are all only one or two clicks away from being in an unregulated gambling app. For Safer Gambling Week, the Betting and Gaming Council asked people to look at two comparable gaming sites, because without realising, people can easily find themselves on one site that is not regulated, whose revenue stream almost certainly goes into dark activity—probably funding some organised criminal activity—and not a regulated sector product, with all the support and safety measures that come with that. Because these things can now proliferate on phones, access to them for people of all ages is now much easier.

There is a genuine concern that we must think about: if that £6 billion is going into the unregulated sector and, as the result of the tax changes—as the OBR recognises—there will be an increase in unregulated activity and problem gaming, is the £26 million for the Gambling Commission enough? Will the £1.1 billion raised by the statutory levy be sufficient? As Dame Caroline Dinenage said, there is genuine concern from some charitable organisations on the ground that they have not yet had their funding for this or confirmation about how they will be able to spend it. Does it just get sucked into the NHS pot to be spent on a medical solution? That might be the solution, but that means that some of the carefully crafted mechanisms to deal with problem gambling will simply lose out as a result of big structural changes to tax.

Absolutely, we do need to do that. I am an old-fashioned state regulator; I like the idea that the state can regulate things. I like the idea of tax and spend as well, which is what we are doing in the Budget. It is a good thing—[Interruption.] I was so close—I raised the hopes of James Wild and then dashed them.

We should think about some of the changes that came in through the white paper, including the whistle-to-whistle ban on promoting certain products, the premier league’s voluntary opt-out on gambling company sponsorship, and the soon-to-be banning of gambling companies on football shirts. Again, that uniquely affects Stoke-on-Trent, because bet365 sponsors Stoke City. Therefore, should we ever make it to the premiership—we came so very close at the beginning of the season, but we are not quite there now—we would have to have a complete change of kit.

There is more that we can do about the unregulated sector, but that should be a collective effort. We should also not kid ourselves that what we are doing today is about trying to get on top of the unregulated sector. We are talking about the taxation of the regulated sector. As a consequence, we may inadvertently push more people into the unregulated sector. The consequence of that will be bad for society and bad for people who are problem gamblers. It will also be a challenge for the Gambling Commission to them try to regulate, and we need to be up front about that.

I recognise that there are some very addictive games that people can get hooked on and spend an absolute fortune, because, as my hon. Friend the Member for Halesowen said, they are affected psychologically; they get drawn in, spending more money to make the experience worth while. But we may be in a perverse situation, because the machine gaming duty rate for a land-based product will be 20%, but the remote betting duty—for products where people can bet on a football match using one of the apps at home—will be 21%. Although we recognise that the gaming side is much more damaging than the betting side, we are going to have a lower rate for land-based gaming than for remote betting, when we recognise that betting as a product presents a safer, more cost-intensive situation. Was that by design, or is it a consequence that the Treasury has not considered? Will the Minister address that point?

The Minister has said that this is a fair levy, taking the gaming rate to 40%. That will make us an outlier compared with our European neighbours. The next on the list are Czechia at 35%, the Netherlands at 34% and Denmark at 28%. There is a point at which the taxation of a product becomes so de minimis in its return that it ceases to have an effect. I have never believed in the Laffer curve—I am sorry to disappoint the hon. Member for North West Norfolk again—but I can see that we will get to a point where we are trying to squeeze an increasingly large amount of money out of a shrinking tax base because more people are taking their spend elsewhere.

That would be damaging for everybody. It would be damaging for my constituents, because if the demand for the service and products made by the companies in my Constituency dry up, the jobs also dry up. It would also be bad for the Treasury because the amount of money it can raise from the regulated sector will decrease, and that is not something that we want to see. Has the Minister looked at the evidence from the Netherlands? When the Netherlands increased its rate, which it did for good reason—a decision around tax and spend in order to raise money to pay for parts of its social programmes—it actually saw a huge spike in the use of unregulated products, with something like a fivefold increase over three years, and a huge decrease in the expected rate of return for its revenue.

There are similar examples in other European countries. I do wonder whether we have looked at those before making some of the decisions that we are making today. Do we have a contingency? It is not that we are hypothecating taxation in this country, but we have said that these changes are, quite rightly, to fund the reduction of child poverty through the removal of the two-child benefit cap. If the revenue rates from the changes decreases, where will the additional money come from?

Finally, will the Minister touch on the impact on Gibraltar? The decisions on gambling tax rates that we make today will have an effect on Gibraltar. Nigel Feetham, the Minister for Justice, Trade and Industry in Gibraltar, has repeatedly pointed out that 3,500 people in Gibraltar derive their job from the gambling sector. It makes up 30% of GDP there; one third of Gibraltar’s tax receipts comes from the gambling sector. He has said only this week that the change will remove tens of millions of pounds from the Government of Gibraltar’s budget. There is absolutely no way they can replace that from domestic sources in any reasonable time.

Given that Gibraltar is one of our important overseas territories, will the Minister set out and explain what conversations the Treasury has had with counterparts in Gibraltar? What are the contingencies if we find ourselves inadvertently creating a massive black hole in the budget of the Government of Gibraltar? Again, if we have to bail them out in some way, where will that money come from? If it is taken out of the revenue that is expected to be raised from this particular rate, that then undermines the figures in other parts of the Budget, which, in its entirety, I support.

My constituents know all too well that there are some gambling companies that thrive on making vast profits from addiction, distress and despair, often delivered straight into people’s homes through online platforms and their mobile phones—quietly but devastatingly tearing families apart. That is why I speak today on clauses 83 to 85 and schedule 13.

Remote gaming, including online slots and casino games, is the most addictive and fastest growing part of the gambling industry. Those products are deliberately engineered to keep people playing, spending and losing long after the fun has gone and the harm has begun. In Wolverhampton North East, through my Constituency casework, I see the real-world consequences of parents trapped in spiralling debt, children going without the basics and relationships breaking under unbearable strain. The Bill addresses that harm head-on.

From 1 April 2026, the rate of remote gaming duty will rise from 21% to 40%, targeting the most harmful and addictive parts of the market. For remote betting, a new rate of 25% will be introduced from 1 April 2027, while bets on UK horseracing are protected and remain at current rates. This reflects the lower harm of these products and recognises the contribution of operators to the statutory horserace betting levy. These targeted increases are not just about raising revenue; they are about disincentivising harmful practices and holding companies to account.

Just as important—especially for my bingo-loving constituents—is what the Bill does not tax. By abolishing bingo duty from 1 April 2026, this Government are recognising that not all gambling is the same. Bingo halls such as the one in Wednesfield are community spaces. They are places of friendship and connections, especially for some of our older residents, so supporting lower-risk activities while cracking down on the most harmful ones is exactly the balanced approach that our communities expect.

These changes will raise over £1 billion a year to support the public finances and Labour’s mission to lift half a million children out of poverty, which will affect more than 4,200 children in my constituency of Wolverhampton North East. They will protect families from harm, support communities and make sure that those who profit from misery finally pay their fair share.

I am grateful to hon. Members for their contributions to today’s debate, and particularly to my hon. Friends the Members for Wolverhampton North East (Mrs Brackenridge), for Morecambe and Lunesdale (Lizzi Collinge) and for Halesowen (Alex Ballinger) for their heartfelt speeches in favour of these measures. I also note the comments of Dame Caroline Dinenage, which I can assure her I did listen to in full, and of my hon. Friend Gareth Snell, both of whom, I accept, have tremendous expertise in this area.

As I have set out, we believe that the measures in clauses 83 to 85 deliver fair reforms to our system of gambling taxation because they reflect the reality of how gambling has changed in our country, the harms that now exist and the need for the tax system to keep pace as these changes continue. The Government’s objective is to strike a balance by raising revenue fairly while avoiding further pressures on land-based operators. New clauses 21 and 25 ask the Chancellor to review the impact of and make a statement on the effects of the increase in gambling duties.

The hon. Member raises an important point. Before I commit to her that I will take that forward, I would like to check what discussions have already taken place. I hope she will accept that that is necessary from my point of view.

Both the proposed new clauses focus on the impacts of the changes to the gambling duty and ask for a commitment to update Parliament within six months of the Bill being passed. First, this Government did not announce, and are not proposing to make, any changes to the treatment of free plays or free bets through this Bill. Furthermore, the Bill does not make any changes to the duty charged on bets placed on horseracing in high street betting shops.

Secondly, on the illegal market, which has been raised a number of times, the Gambling Commission is already tackling that risk and is protecting consumers, but we recognise that modern technology makes it easier for illegal websites to target consumers. To strengthen enforcement and protect consumers from dangerous illegal sites, we are providing an additional £26 million to the Gambling Commission over the next three years. I hope I can assure my hon. Friend the Member for Stoke-on-Trent Central that the £100 million a year in the form of the statutory levy is ringfenced for prevention, treatment and research in this area.

The Government published a tax information and impact note for this measure at the Budget. As is set out in that note, consideration will be given to monitoring and evaluating the expected Exchequer impacts of the policy after at least two years of monitoring data has been collected and analysed. More broadly, the Government continually monitor the operation of all taxes and keep them under review to ensure that they deliver on their intended outcomes and, indeed, are fit for purpose. For those reasons, the proposed statement and the impact assessment are not necessary.

The measures in clauses 83 to 85 deliver fair reforms to our system of gambling taxation. They reflect how gambling has changed in our country, the harms that now exist and the need for the tax system to keep pace as those changes continue. The Shadow Exchequer Secretary, James Wild, raised levels of employment. He will know that right across the piece, the OBR expects that employment levels will rise in every year of the forecast. Costings were also raised, including by my hon. Friend the Member for Stoke-on-Trent Central. The OBR has taken account of behavioural impacts within its costing. Of course, those costings have been certified and scrutinised in the usual way.

The Liberal Democrat spokesperson, Daisy Cooper, asked about engagement with industry. I can confirm that the Government, as I hope she would expect, engaged with a number of stakeholders, including from the gambling industry, as part of the consultation process. My hon. Friend the Member for Stoke-on-Trent Central also raised Gibraltar. Of course we recognise that Gibraltar has a gambling industry that very much faces the UK. I can assure him that there has been engagement, not by me, but by some of my colleagues in the Treasury, with Gibraltar to that end.

It was not me who had those engagements, but as I said, I confirm to the hon. Member that we are not proposing to make any changes to the treatment of free plays and free bets through the Bill, which I hope reassures her in that regard.

I urge the Committee to reject new clauses 21 and 25 and agree that clauses 83 to 85 and schedule 13 should stand part of the Bill.

Question put and agreed to.

Clause 83 accordingly ordered to stand part of the Bill.

Clauses 84 and 85 ordered to stand part of the Bill.

Schedule 13 agreed to.