When the Department for Culture, Media and Sport published its White Paper on gambling reform in April 2023, it highlighted the threat of the black market, estimating that it represented no more than 2.5% of all remote gambling in Great Britain.  However, the threat of an increased black market was flagged and a commitment was made to introduce legislation to give the Gambling Commission new powers to disrupt illegal gambling, such as to obtain court orders requiring internet service providers and payment providers to block access to unlicensed websites.   

In September 2024, Frontier Economics prepared a report for the Betting and Gaming Council, conservatively estimating that £2.7bn ($3.6bn) was staked annually on the black market in Britain (representing 2.1% of the £128bn staked with regulated online operators annually). The Report stated that younger gamblers were more likely to be aware of and to use black-market operators, with one in five 18–24-year-old gamblers using unlicensed operators or social media/messaging apps to gamble. The Report evidenced a much higher use of VPNs to gamble by younger respondents and stated that better bonuses, ease of setting up an account and anonymity were the major attractions of using unlicensed operators.   

The gambling industry now fears that significant increases in remote gaming (21% to 40%) and remote betting duty (15% to 25%) introduced in the November 2025 Budget, alongside player protection and social responsibility measures that have already been introduced, will lead to an explosion in the black market. It appears inevitable that operators will have to reduce bonuses, alongside other expenses, to mitigate these increased taxes. Because bonuses have been shown to be a significant attraction of using the black market, a reduction in bonuses by regulated operators to maintain profitability will undoubtedly lead to British customers seeking out unlicensed websites.     

There is already evidence that increasing remote gambling taxes drives customers toward the black market. In the Netherlands, remote gaming duty was increased from 34.2% to 37.8% of gross gaming revenue (GGR) on 1 January 2026, which is broadly similar to the new rate of remote gaming duty in the UK.   

The Netherlands gambling regulator, the Kansspelautoriteit (KSA) has previously reported that increased gambling taxes had not resulted in an increase in tax revenue.   

In its most recent analysis of the market, the KSA reported that, while 94% of Dutch customers gamble legally, the percentage of total money gambled legally reduced from 51% at the end of 2025 to 49% at the beginning of 2025 (i.e. more than half of all Dutch online gambling spend was with unlicensed operators).  The KSA believes that this downward trend is due to individuals switching to illegal offerings, due to newly introduced player protection regulations. Action by the KSA to fine illegal operators has been largely unenforceable and ineffective.   

Elsewhere in Europe, Norway, which operates a state gambling monopoly model, has had mixed results in restricting the black market. The Norwegian Gambling Authority (Lotteritilsynet) has had some success in website blocking, payment restrictions and advertising controls. In Spring 2025, it issued blocking orders against at least 57 offshore websites and there is evidence of reduced black-market gambling (revenue reduced by 18% from 2023 to 2024) albeit with a significant illegal market still in existence.     

In Britain, we are now nearly three years down the line from the White Paper. Despite proposals to introduce domain name, IP address and payment blocking measures in the Criminal Justice Bill and Crime and Policing Bill, new legislation is progressing slowly. At the Gambling Commission CEO Briefing in November 2025, figures were given for action the regulator had taken between April 2025 and October 2025 to tackle illegal gambling. Andrew Rhodes stated that, during this period, 188,297 URLs had been reported to search engines by the Commission and 10,419 blocked. In total, 504 websites had been taken down or geo-blocked; 659 websites were referred to search engines for delisting and 480 cease-and-desist letters were issued to advertisers and operators. While this is a commendable effort, action taken by regulators is often likened to “whack-a-mole,” with new websites popping up as soon as one is taken down.       

The Gambling Commission was handed an extra £26m in the 2025 Budget over the next three years to “tackle the illegal market.” This is a relatively small amount, given the technical complexity and size of the task involved. This is particularly the case, as duty increases are likely to drive more high-spending customers towards bonuses and incentives offered by black-market operators.  It therefore remains to be seen whether forthcoming legislation, including domain and IP blocking measures will be effective, as many of the proposed powers relate to blocking of domain names and IP addresses which are registered or hosted in GB. For obvious reasons, illegal operators will ensure their operations are hosted overseas.   

Time will tell whether Britain follows the Netherlands, with significant amounts of online gambling spend migrating to the black market. If this happens, the Government will have shot itself in the foot, as the anticipated increase in tax revenues will not materialise.