Chancellor Rachel Reeves has unveiled a significant tax overhaul targeting alcohol, tobacco, and vaping products as part of the Labour government's Autumn Budget statement.
Key Tax Increases Announced
The Chancellor confirmed that alcohol duty will rise in line with inflation, while tobacco duty will increase above the rate of inflation. In a landmark move, the government will also introduce a new duty on vapes.
These measures form part of the government's strategy to address what it describes as a £40 billion black hole inherited from the previous Conservative administration.
Gambling Duty Reforms
Alongside the sin tax rises, the Budget introduces sweeping changes to gambling duties. Remote gaming duty will climb from 21 per cent to 40 per cent, effective from April 2026.
Additionally, a new general betting duty rate of 25 per cent for remote betting will be implemented from April 2027. In a relief to traditional venues, bingo duty will be completely scrapped.
Financial expert Martin Lewis commented on X: "Gambling taxes being reformed for online gaming (duty up from 21% to 40%, and online betting 15% to 25%). No change to in person gambling or horse racing. Bingo duty being abolished."
Exemptions and Future Projections
The new betting levy will not impact self-service betting terminals, spread betting, pool bets, or horseracing. Casino gaming duty bands will be frozen in 2026-27 before increasing in line with RPI in subsequent years.
The Treasury estimates that this tax raid on gambling firms and betting companies will raise approximately £1.1 billion by 2029-30, providing significant additional revenue for public services.
These measures represent the Labour government's continued use of fiscal policy to reshape consumer behaviour while filling the public coffers, with particular focus on modern consumption habits through the introduction of vape duties.
