A group of Lancashire MPs has joined more than 100 colleagues nationwide to urge Chancellor Rachel Reeves to introduce a targeted levy on harmful online gambling products to help tackle child poverty.
In a letter sent ahead of the Autumn Budget, the MPs argue that online gambling is taxed too lightly given its rapid growth and the social costs it creates.
They recommend a new levy on remote gambling, with revenue ring fenced to support the abolition of the two-child benefit cap and wider measures to reduce child poverty.
In their letter, the MPs state that “the need for action is urgent” because of alarming child poverty figures.
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They emphasise that over 4.3 million children, almost one in three, are living in poverty in the UK, with the Joseph Rowntree Foundation warning that, without policy change, this is set to rise further by 2029. Economic growth alone, they argue, will not reverse this trend; targeted and sustainable investment is required.
The MPs highlight that the UK’s 21 per cent tax rate on online gambling is well below levels in other countries, such as 37.8 per cent in the Netherlands and 55 per cent in Pennsylvania, and note that remote gambling now accounts for nearly half of all UK gambling profits.
They stress that British horseracing should remain protected through a differentiated tax approach, recognising its cultural and economic importance.
The proposed levy would, the MPs say, provide a fair, immediate source of funding to help lift millions of children out of poverty, aligning fiscal responsibility with social justice.
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The six MPs are:
- Cat Smith MP — Lancaster and Wyre
- Lizzi Collinge MP — Morecambe and Lunesdale
- Lorraine Beavers MP — Blackpool North and Fleetwood
- Maya Ellis MP — Ribble Valley
- Paul Foster MP — South Ribble
- Sarah Smith MP — Hyndburn
Paul Foster MP said: “I’m calling for the abolition of the two-child benefit cap because it’s holding too many families back. We live in one of the wealthiest countries in the world, yet far too many children are growing up in poverty.
That’s why I’ve joined over a hundred colleagues in writing to the Chancellor, proposing a targeted levy on online gambling to help fund action on child poverty.
The gambling industry is hugely profitable—it’s only fair that it contributes more to the society from which it profits.”
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Sir Mark Hendrick MP for Preston also supports the movement, he told Blog Preston: “We know that gambling can cause harm, to young people, families, and in deprived communities especially where gambling venues are concentrated.
“The UK’s gambling industry is a £15.6bn sector that pays only £2.5bn in tax. Almost all forms of gambling are exempt from VAT, with the sector taxed far less than other high-profit industries – such as tobacco – and taxed far less than other international jurisdictions.
“Despite this, gambling harms lead to huge costs to our health, public services and communities. UK online gambling operators often avoid VAT and base operations offshore, contributing less in UK tax despite significant domestic profits.
“The Government pledged to reduce gambling related harm and enable vital action to alleviate child poverty at the last election and I support the call to introduce a targeted levy on harmful gambling products, with revenue ringfenced to help address child poverty and related harms.
“Sadly, the relative rate of child poverty in the Preston constituency is much higher than the national average at 37 per cent. That’s 8,666 children aged 0-15 who are living in households with income below 60% of the median income (2023/24).
“The UK average in comparison is at 21.8 per cent, over the same time period. More alarming is the fact the rate is rising and something drastic needs to be done to reverse this trend.
“A gambling levy would offer a credible, fair and immediate source of revenue to effectively tackle child poverty in Preston and the UK.”
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