The UK government has published its response to the consultation on the structure, distribution, and governance of the statutory levy on gambling operators. It is set to introduce the statutory levy on operators via secondary legislation later this year. This new measure is expected to come into force on 6 April 2025, with operators required to make their first statutory levy payments by 1 October 2025, during the 2025/26 financial year.
The statutory levy will be collected and administered by the Gambling Commission (the Commission) under the strategic direction of the UK government. This will replace the existing system of voluntary industry contributions. The funds from the statutory levy will be allocated in specific proportions for research, prevention, and treatment (RPT) services.
Background and Purpose of the Consultation
The public consultation, which ran from 17 October to 14 December 2023, was initiated following the review of the Gambling Act 2005 and the publication of the Gambling White Paper (the White Paper) in April 2023. The White Paper outlined the government’s plans to modernise the regulation of the gambling sector, with one of the key proposals being the introduction of a statutory levy. This statutory levy represents a significant shift in the funding system for RPT of gambling-related harms.
The primary purpose of the consultation was to gather views on the structure, distribution, and governance of the statutory levy. The government aimed to ensure that the statutory levy would provide sustainable and equitable funding for initiatives aimed at reducing gambling harm. By consulting on these key aspects, the government’s stated objective was to design a statutory levy that would be effective, proportionate, and based on the best available evidence. The consultation also aimed to address the complexities involved in transitioning to the new system and to ensure that all licensed operators contribute fairly to the funding of RPT services.
This consultation was a key step in the government’s efforts to reform gambling regulation and strengthen protections for those at risk of gambling-related harm.
To inform policy decisions, the Department for Digital, Culture, Media and Sport (DCMS) commissioned a research team led by Professor Heather Wardle at the University of Glasgow to engage with key stakeholders on gambling prevention. Workshops with practitioners, academics, and third sector professionals in related health fields were conducted in January 2024. The findings, published on 18 March 2024, reflect the views of the report authors and not the official stance of DCMS, but were no doubt influential in shaping the statutory levy.
Scope and Rate of the Statutory Levy
The statutory levy will apply to all operators licensed by the Commission, covering both online and land-based entities, as well as society lotteries and External Lottery Managers (ELMs). The statutory levy rates, which depend on the sector, range from 1.1% to 0.1% of Gross Gambling Yield (GGY):
- Online operators and software licences: 1.1% of GGY
- Land-based casino and betting operators: 0.5% of GGY
- Adult gaming centres, on-course bookmakers, and bingo premises: 0.2% of GGY
- Other licensees, including society lotteries and ELMs: 0.1% of GGY
The National Lottery will not have to pay the statutory levy. The statutory levy is expected to generate approximately £90 million to £100 million annually by 2027, based on data from the Commission. To ensure adequate funding, slight adjustments have been made to the statutory levy rates initially proposed during the consultation phase.
Distribution of the Statutory Levy across RPT Services
The Commission will manage the distribution of the statutory levy throughout Great Britain. This will be managed under the strategic guidance of the government to support RPT of gambling-related harm.
Research
20% of the funding will be allocated to research and innovation for the establishment of a bespoke Research Programme on Gambling. Also, the Commission will direct further research in line with its licensing objectives, taking into account its current Evidence Gap and Priorities.
Prevention
30% of the funding will be allocated to developing a comprehensive prevention strategy across Great Britain. The government will appoint a lead commissioning body based on a thorough review of the available evidence.
Treatment
50% of the funding will go to NHS England and appropriate bodies in Scotland and Wales to commission treatment and support services for gambling-related harms, including those in the third sector.
Governance and Review of Statutory Levy
The government’s response outlines several key points regarding the governance and review of the statutory levy distribution. Key measures include:
- A Gambling Levy Programme Board (LPB) will serve as the central oversight body, including key government departments such as DMCS, HM Treasury, DHSC and DSIT, along with representatives from the Scottish and Welsh governments. The UK government will continuously evaluate the LPB’s membership and consider expanding it as the statutory levy system develops.
- A Gambling Levy Advisory Group (LAP) will be established to provide expert advice on funding priorities and emerging issues. Chaired by DCMS, the LAP will include the Commission, commissioning leads, and representatives from public health, lived experience, criminal justice, research, the third sector, and local government.
- Formal review will be conducted within 5 years to evaluate and adjust the statutory levy system to ensure it meets its goals and objectives, with the first formal review expected by 2030.
UK Government’s Commitment to Tackling Gambling Harm
Speaking about the statutory levy, Baroness Fiona Twycross, Minister for Gambling and DCMS Lords Minister, emphasised its importance in a written statement released by UK Parliament, stating: "The current funding system for research, prevention, and treatment of gambling-related harms reliant on voluntary donations from industry is no longer fit for purpose ... [T]hat is why we are taking the decision to introduce a statutory levy as a priority, in line with our manifesto commitment to reduce gambling harms.”
This sentiment reflects the government’s broader commitment to implementing the White Paper, which includes other measures such as online slot stake limits and enhanced financial and vulnerability checks (our separate article on the Commission’s response to financial and vulnerability checks can be found here).
Overview on the Online Slot Stake Limits
In addition to the statutory levy, the government has also announced the introduction of online slot stake limits. Adults aged 25 and over will have a maximum stake limit of £5 per spin, while young adults aged 18 to 24 will be subject to a £2 per spin limit. These limits are designed to protect vulnerable groups from gambling addiction.
These proposed online slot stake limits will complement the changes to slot game design introduced in 2021. These changes include reducing the speed of play and prohibiting autoplay features. The introduction of these changes is anticipated to have a significant impact on the online gambling industry, requiring operators to adjust their offerings and implement new safeguards to protect players.
Update on Personal Management Licences
As previously discussed in our article, "Gambling White Paper Consultations: The Commission’s First Responses", the Commission’s revised Licence Conditions and Codes of Practice for Personal Management Licences have now come into effect. Operators are advised to review and update their governance structures to ensure compliance with the new requirements.
Co-authored by Florentina Terholli, trainee solicitor at CMS.
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