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NEW YORK - Flutter Entertainment plc (NYSE:FLUT; LSE:FLTR) announced Wednesday that the UK government’s autumn budget includes substantial tax increases on online gambling operations that will significantly impact the company’s earnings.
The tax changes include a 19 percentage point increase in iGaming duty to 40 percent effective April 2026, and a 10 percentage point increase in sports betting tax to 25 percent effective April 2027.
Flutter estimates these changes will reduce its adjusted EBITDA by approximately $320 million in fiscal 2026 and $540 million in fiscal 2027 before mitigation efforts. The company expects to offset about 27% of the impact in 2026 and 37% in 2027 through first-order mitigation measures, including reduced operational, promotional and marketing spending.
The world’s largest online betting operator plans additional "second order mitigation benefits" through market share gains and operational efficiencies to further reduce the financial impact in the medium term.
Kevin Harrington, Flutter’s UKI CEO, called the tax increases "a very disappointing outcome" that will have "a significant adverse impact" on the industry. He warned the changes could benefit illegal gambling operators who don’t pay taxes or invest in safer gambling.
"At 40 percent, the UK’s remote gaming duty is now above countries such as the Netherlands, where a recent tax increase saw a rise in illegal gambling and a fall in Government receipts," Harrington said in the press release statement.
Despite these challenges, Harrington expressed confidence that Flutter’s scale and leading market position in the UK would help the company navigate through the changes.
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