Between April 2023 and April 2024, the online sector of the gambling industry had a staggering £6.9 billion gross yield, representing an impressive 6.9% increase from the previous period. For many, this sector allows them to enjoy their favourite games from the comfort of their own home and offers an unparalleled level of convenience. After all, who doesn’t love spinning slots from their sofa?
However, that doesn’t mean the industry hasn’t faced challenges. Difficult economic times, when players have less disposable income, can result in less money to spend at iGaming sites. I’ll look at this and at the proposed changes to the remote gaming duty, which could see the way providers pay tax change. First, let’s look at which hurdles the industry has to jump in order to grow!
What Economic Challenges Does the iGaming Industry Face?
Whether it’s a tumultuous economic situation or changes to the tax system, the industry comes up against its fair share of challenges. In the UK, real household disposable income (meaning adjusted for inflation) decreased 1.0% per individual in Quarter 1 of 2025. Lower disposable income means people have less money to dedicate to gambling, which can result in lower income for iGaming providers.
Alongside a decrease in disposable income, the UK has also seen high levels of inflation. Between September 2024 and September 2025, inflation levels were at 3.8%, well above the Bank of England’s target of 2%. Inflation represents an increase in the price of goods and basic services in the country, which has increased operating costs across industries.
How Does Tax Work for the Gambling Sector?
At the moment, gambling providers fall into one of a variety of categories for paying taxes, which determines at what level they pay. For those in the iGaming sector, they’ll pay remote gambling duty, which is set at 21% of profits. There are also two other tax excise duties that iGaming providers can fall under, general betting duty and pool betting duty, which can make things quite confusing for providers who offer multiple products.
However, with the income of online gambling providers overtaking their land-based competitors, there have long been calls for reform to the tax system. At the end of April 2025, the Government proposed a new single tax on online providers, called the Remote Betting and Gaming Duty. It condenses the three different brackets into one, meaning that all online providers would pay the same rate.
There’s also been strong calls for it to include an increase in tax rates to reflect the growth of the online sector. Between 2015 and 2024, remote providers saw a 63% growth in yield, while in the same period, the land-based sector saw a decrease of 14% and a 28% drop in the number of premises. The difference in growth of the two gambling streams is why many feel iGaming providers should contribute more.
How Likely are We to See an Increase in Remote Gaming Duty?
Given the extent to which the proposal looks to shake up the remote gambling tax system, it seems a likely opportunity for the Government to introduce an increase in tax. There have been growing numbers of MPs, including over 100 in the Labour Party, calling for a hike in the tax from 21% to 50%. They argue the increase could generate an additional estimated £3.2 billion a year and be used to raise 500,000 children out of poverty.
However, others have warned that it could lead to a decrease in revenue and contribution, similar to that seen in the Netherlands. In January, the Dutch gross gambling revenue tax was increased from 30.5% to 34.2% and in August, the Dutch regulator (KSA) estimated it would result in a €40 million shortfall in iGaming revenue. There are also others who are concerned that condensing the tax into one would mean floundering sectors, like online horse race betting, would be taxed at the same level as flourishing ones, like online slots. Overall, it would certainly give the iGaming industry another challenge to rise to.
What Makes the iGaming Industry Thrive?
Despite all the challenges I’ve just covered, the iGaming industry continues to thrive in the UK. Let’s look at exactly how it’s able to do so even in the most challenging of times. We’ll take the Coronavirus pandemic of 2020 as our example. In-person gambling venues suffered significantly, with the number of UK adults gambling in person once a month declining from 35.1% in 2019 to 24.5% in 2021. In March 2020, all in-person gambling venues closed, leaving places like supermarkets that sell scratch cards and lottery tickets as the only in-person gambling and causing half of the industry to grind to a halt.
iGaming providers did not suffer this same fate and were a popular alternative to allow players to continue gambling from their homes. They capitalised on this change in behaviour, offering players incentives to try out new games like slots or poker. Online betting also saw a boost, with more of us watching television and betting on the leagues still playing—like the Bundesliga, which resumed on the 16th of May.
Quick to Adapt
That brings me neatly onto the first reason behind the iGaming industry’s strength—its ability to rapidly adapt and innovate. The industry is always quick to adapt to suit the needs of its consumers. Let’s take slots as our example; the online industry’s biggest product has shot up in popularity in recent years, and in the first three months of the year, exceeded the yield of betting. In March alone, online slots generated over £250 million, a rapid growth when compared to the £190 million turned over in January the previous year.
Slots appeal so widely because they’re lower budget and lower commitment options compared to other products in the industry. A single spin can start from as low as 10p, making slots more accessible to a wider audience. During times of economic difficulty, they’re popular with those on a stricter budget, allowing them to stretch their budget as far as possible.
Innovation and Choice
The industry recognised the potential that lies in slots and has gone all in. There are now more options than you could shake a stick at, and the libraries of most online providers are dominated by slots! In order to cater to all players, there are all the nostalgic classics, like video and three-reel slots. On top of that, there are innovative options that keep the offering interesting, like virtual reality or interactive slots (my personal favourites for their extra gaming layer!).
The market is endless; I think I could probably play a different slot every day for the rest of my life! Whether players are after a slot themed after their favourite band, one with additional multipliers, or one that incorporates an intricate narrative, there’s an ideal option for them, keeping them coming back for more.
Plenty of Bonuses
Another way the iGaming industry offers more choice than its in-person competitors is through bonuses. While you’ll likely never see a bonus offered at a physical casino, everyone can make the most of them when playing online. There are even specific bonuses, like low or no deposits, which make sure those on the tightest budgets don’t miss out. Players are more likely to choose the iGaming industry if they truly want their money to go as far as possible.
Online providers also offer things like competitions, tournaments, and challenges, where players can earn additional rewards while competing against each other. It replicates the sense of competition to similar levels found in in-person venues and adds the social element many of us enjoy. All the choices offered by the iGaming industry is just one of the reasons it remains resilient to economic challenges.
How Does the iGaming Industry Rise to Economic Challenges?
The iGaming industry seems to be able to rise to any of the financial challenges thrown at it, including in the most uncertain times, such as the pandemic. It manages to do this through constant adaptation to reflect the needs of the customer and innovation to introduce new game choices. The sector has come to a point where no matter what you’re looking for and what budget you’re playing on, there’s a suitable option for you. It keeps up with the challenges and demands of its user base, allowing it to continue to thrive.
That’s not to say that the industry doesn’t face its challenges, though, as decreases in players’ disposable income and proposed changes to taxes all threaten its growth. Although an increase in remote gaming duty isn’t yet certain, it seems that either way, there will be changes to the rates in the next few years. Despite all the economic challenges the iGaming industry faces, its variety of game choices, budget options, and innovation continue to draw players and profits in.
Slobodan Brkljac is a leading writer in the iGaming field and has quickly become one of the industry’s most trusted voices since 2020. He combines the knowledge from years of experience reviewing providers with the insight of being a keen player himself. Slobodan’s honest reviews and articles have made him the go-to for all things iGaming!
