The Department for Culture, Media and Sport has confirmed a 25% increase in Gambling Commission licence and application fees, effective from 1 October 2026. The decision, announced this week, represents a middle ground after the government considered three alternatives during its January to March consultation period.

A Measured Response to Budget Pressures

DCMS rejected its initially proposed options of a 30% rise, a 20% rise, or a 20% rise coupled with an additional 10% ringfenced specifically for illegal-market enforcement. The 25% uplift strikes what officials describe as a proportionate balance, applying across most licence categories while carving out targeted exemptions.

The Gambling Commission faces an annual budget shortfall of roughly £4 million, a gap that fee increases alone cannot fully resolve. Even with the 25% rise implemented, the regulator will need to find a further £8 million in efficiency savings over the next five years. Both DCMS and the Commission emphasised that the move is essential to prevent significant reductions in regulatory activities and enforcement capability.

Selective Application and Structural Reforms

The increase applies to operating licence fees, application fees, first annual fees, personal licences, variations, and corporate control changes. Supplementary operating licence fees and single machine permit fees will also rise by 25%, whilst first annual fees remain set at 75% of the full annual fee.

Society lotteries, though, have been frozen from the increase entirely. This preserves funds directed to good causes. Ancillary society lottery licence fees will maintain current levels.

A more significant structural shift affects on-course bookmakers. The general betting (limited) operating licence fee model will transition from a days-based calculation to one centred on gross gambling yield (GGY). DCMS expects this change to benefit 44% of operators in the category through lower fees, whilst 53% will face only modest increases of around £22 annually.

The Cumulative Burden

The timing stings. This fee increase arrives months after the government implemented steep gaming duty rises that substantially elevated operational costs across the sector. The consultation generated 47 responses, with the majority opposing any fee increases. Operators cited cumulative financial pressures, the proportionality of flat percentage increases applied to lower-harm activities, and questions about funding mechanisms for illegal gambling enforcement.

DCMS has rejected the Gambling Commission’s call to ringfence fee revenue specifically for illegal-market work. Instead, the Treasury has committed £26 million over three years to support the regulator’s illegal-market strategy outside the fee structure.

The changes will be implemented through secondary legislation. For major operators with annual GGY exceeding £100 million, fees will rise from approximately 0.1% to about 0.15% of yield, whilst larger remote and non-remote operators may face six-figure annual licence fees reflecting their market presence.