More and more UK players are using gambling sites based overseas, particularly those registered in places like Curaçao or Malta.
This shift has made it harder to apply existing rules and collect tax, but it also reflects a wider change in the digital world—one that could prompt a fresh look at how gambling revenue is handled.
Changing Habits and Regulatory Gaps
Gambling behaviour in the UK is not what it used to be. The way people access and interact with platforms has shifted, often slipping past the reach of long-standing regulations. What was once a clearly defined system now struggles to keep pace with a far more flexible reality. Speed matters to many. For some, it’s about fast withdrawals. Others value multilingual support or enjoy taking part in events beyond the local scene. Loyalty schemes, too, have grown in importance—especially those offering more than the limited formats allowed under domestic rules.
Increasingly, people are choosing services outside the scope of GamStop, where restrictions are lighter. Sites operating without GamStop exclusion tend to offer more generous rewards, greater freedom, and fewer entry barriers. In many cases, identity checks are quicker, setup takes less time, and payment options are broader. It’s this combination of ease and access that continues to draw attention.
All of this points to something larger. Digital habits are changing, and they’re doing so across borders. Rules made for a different era no longer match how things work today—and that’s where the conversation on taxation must begin.
Rethinking Digital Taxation for a Globalised Market
In 2020, the UK introduced the Digital Services Tax (DST). It was a targeted measure—applied not to gambling, but to global tech companies generating substantial revenue from UK users. At 2%, it’s modest. But it marked an important precedent: tax policy recognising value creation beyond borders.
The DST could serve as a template. If adopted, it might offer a way to capture some of the value being generated by offshore casinos, especially those with substantial UK user bases. Doing so wouldn’t require a rewrite of gambling law, but an extension of the UK’s digital tax logic into adjacent sectors.
The benefits wouldn’t just be financial. A clear, structured levy could incentivise certain offshore operators to formalise their UK presence—through partnerships, tax agreements, or voluntary reporting. That, in turn, could help policymakers regain a degree of visibility into a sector that’s otherwise opaque.
Here’s where strategic thinking becomes vital. Instead of trying to force offshore platforms into the domestic licensing framework, the UK could focus on building fiscal bridges—tools for capturing revenue without demanding full regulatory control.
Practical Levers the UK Could Explore
If the UK were to respond with a targeted tax strategy, the design would matter. The following elements would likely make the biggest difference:
A revenue threshold for offshore operators interacting with UK users, triggering a digital levy based on user origin.
Voluntary disclosure schemes for platforms willing to report UK-based income in exchange for tax transparency incentives.
Encouraging fintech integrations that allow UK-based financial providers to support traceable cross-border transactions with embedded taxation protocols.
Such approaches wouldn’t require chasing individual players or criminalising offshore access. They would shift the burden upward—toward the platform, not the user.
Offshore Platforms and the Changing Player Profile
Today’s digital gambler operates without borders. Traditional distinctions between domestic and offshore services have blurred, thanks in part to advances in payment systems, cryptocurrency use, and increasingly mobile-friendly interfaces. UK players are no longer bound by national site options—they seek out platforms offering better bonuses, broader game libraries, or fewer restrictions.
Recent data from the Gambling Commission confirms the trend. By 2025, over one in four remote gambling sessions involving UK players now occur on sites operating outside of UKGC oversight. That’s not anecdotal—it’s a clear sign of structural change.
This shift doesn’t just affect regulation; it affects where the money flows. When play moves offshore, so do potential tax revenues.
The Revenue Vacuum: Unlicensed, Untaxed, Untracked
Under the current system, only operators licensed within the UK are taxed, mainly through the Remote Gaming Duty. When players use services based abroad, often licensed elsewhere, the money spent no longer falls within HMRC’s grasp.
What this creates is a widening gap: a sector generating billions in online engagement, with only a portion captured under national tax rules. The challenge isn’t just about enforcement—it’s about the underlying structure of the system itself. Designed for a time when most gambling was location-based and nationally regulated, today’s policies fall short in addressing how the market actually behaves.
As player behaviour continues to evolve and remote platforms attract growing attention, the UK must grapple with the scale of digital gambling beyond its borders. Without mechanisms to trace or tax this activity, potential public revenue is left untapped, and regulatory oversight weakens in tandem.
Building a Modern Framework: From Regulation to Innovation
The current regulatory response to offshore gambling is largely prohibitive. Ads from unlicensed providers are banned; access is discouraged. Yet the internet has a way of bending around blockades. Prohibition has never been an especially effective strategy in digital markets.
A smarter approach would begin by recognising what offshore platforms are doing right. Many are innovating faster than licensed operators—experimenting with blockchain payouts, gamified loyalty systems, or new social gambling formats. Instead of pushing this activity underground, policymakers might consider drawing it closer.
It’s not about lowering the bar—it’s about aligning the rules with how the market actually works. If licensed UK operators are given room to trial features typically found on offshore sites, within a controlled framework, innovation can happen without shifting activity abroad.
A balanced strategy that combines updated licensing with selective taxation could keep the UK ahead while preserving essential safeguards.
Broad Economic Impacts and Forward Momentum
It’s tempting to see offshore gambling as a niche issue, but its ripple effects are wider than they appear. In a digital economy, small policy shifts can unlock large fiscal flows.
Consider the wider effects of a smarter offshore strategy:
Increased public revenue from previously untracked user activity.
Incentives for offshore operators to enter the UK’s tax net, if not its full regulatory domain.
Alignment with global digital tax movements, such as the OECD’s proposals for fairer cross-border revenue distribution.
These outcomes won’t materialise overnight. But the first step is reframing the question—not “How do we block offshore casinos?” but “How can we monetise the reality of their presence?”
By addressing the issue directly, the UK has an opportunity to draw parts of the offshore gambling sector into a clearer and more accountable tax structure. This approach supports innovation without losing regulatory grip, while also showing a willingness to lead in shaping international digital policy rather than reacting to it.
A Shift from Resistance to Resilience
Offshore gambling isn’t a passing trend—it reflects how a connected digital world naturally evolves. Blocking it entirely is neither realistic nor effective. The UK has an opportunity to take the lead by developing a policy that carefully balances adaptability with oversight.
By applying the thinking behind the Digital Services Tax, introducing smarter ways to capture offshore-generated revenue, and considering more flexible regulatory solutions, a previously overlooked area could become an economic advantage. The focus shouldn’t be on pursuing every international platform, but on building a system that recognises how global markets work—while ensuring value doesn’t go unaccounted for.
