Flutter expects UK tax changes to have a £500 million impact, Richard Clarke, managing director of the group’s Paddy Power and Betfair brands, said at the SBC Summit in Lisbon on October 7.

Clarke warned that the greater danger would be an illegal market growing faster than licensed gambling in Britain. His comments were reported by iGaming Business and CDC Gaming.

The figure is a company estimate. It is not an audited loss or a confirmed forecast of job cuts. Clarke said the financial effect had already started to appear in 2026, but Flutter has not published its detailed response.

The policy challenge is becoming sharper: raise gambling duties without making illegal operators more attractive to British customers.

Why the tax pressure is arriving in stages

The first major change is already in force. HM Revenue and Customs increased Remote Gaming Duty from 21% to 40% on profits from remote gaming with UK customers from April 1, 2026. The tax applies to gaming profits, not total customer stakes.

  • Remote Gaming Duty: increased from 21% to 40% from April 1, 2026.
  • Remote betting duty: scheduled to rise from 15% to 25% from April 1, 2027.
  • Remote bets on UK horse racing: remain outside the new rate and continue at 15%.

The details are set out by HM Revenue and Customs. The wider gambling-duty package is intended to raise more than £1 billion a year for public finances.

The government rejected a single remote betting and gaming tax after its 2025 consultation. Betting and gaming will continue to face separate rates instead.

Scale could strengthen the biggest operators

Josh Hodgson of H2 Capital said leading operators already control about two-thirds of the UK market. He suggested that their share could move towards 80% as smaller businesses struggle with tax, technology, compliance and safer-gambling costs.

Clarke agreed that scale gives larger companies more room to spread fixed costs. Flutter could gain market share if weaker competitors retreat, merge or reduce their British operations.

The likely result is a more concentrated regulated market. Large licence holders may have greater resources for identity checks, fraud controls and safer-gambling teams. Consumers, however, could face fewer regulated choices.

Why Flutter says growth would not be enough

Clarke rejected the idea that Flutter should welcome market-share gains if unlicensed gambling grows faster. A larger regulated operator would not represent success if more British customers moved to sites outside the Gambling Commission’s oversight.

Unlicensed sites do not have to follow the same British rules on self-exclusion, age checks, customer interaction, anti-money-laundering controls or complaints handling.

The Gambling Commission’s 2026 risk assessment also warned that illegal gambling can generate criminal proceeds and be used to launder money. The regulator’s concerns are set out in its 2026 illegal-market risk assessment.

Flutter said 550 employees work full-time on safer gambling. Clarke argued that licensed operators must show customers what protections they could lose offshore, while regulators and payment companies need to do more to restrict illegal access.

Protection is becoming part of the tax debate

The warning comes as the Gambling Commission prepares a staged rollout of Financial Risk Assessments. The first stage will cover customers aged 25 and over who exceed £5,000 in net deposits over a rolling 24-hour period.

  • Standard threshold: more than £5,000 in net deposits over 24 hours.
  • Higher-risk groups, including customers under 25: more than £2,500.
  • Expected share of accounts requiring an assessment once fully implemented: fewer than 3%.

The Gambling Commission says the checks must be proportionate. Heavy-handed processes could push some customers towards illegal operators. The regulator’s staged approach is described in its rollout announcement and its July 2026 update.

That creates a difficult test for Britain’s licensed market. Operators must protect customers in financial difficulty without making legal services so costly or restrictive that unlicensed alternatives become more appealing.

The next test for Flutter and its rivals

Flutter’s £500 million estimate puts the debate in financial terms. The consequences reach further. Smaller operators may face greater pressure, large groups may gain market share, and regulators will be judged on whether the legal market remains both safer and accessible.

April 1, 2027, is the next major test. That is when the higher remote betting rate begins. Flutter has not published a detailed plan for managing the expected impact.

Its central warning is clear: tax policy may fail if the regulated market shrinks while unlicensed gambling fills the gap.