Renewed hostilities
SMF machine tax proposal opens fresh battle for UK’s gambling sector
A doubling of machine games duty could cripple the land-based sector.
Miller leaves the UK Gambling Commission, bound for consultancy.
The CFTC opens up a new Polymarket investigation.
Cambodia attempts to clean house.
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Back in the firing line
One way or another, I’m gonna find ya: Less than a year after UK Chancellor Rachel Reeves sharply increased taxes on online gaming in the Autumn Budget, the Social Market Foundation (SMF) has returned with a fresh proposal that could prove equally controversial for the land-based industry.
The think tank has called for the government to introduce a new 40% rate of machine games duty (MGD) on Category B gaming machines.
It said the measure could raise £275m-£458m annually while reducing gambling-related harms.
I’m gonna get ya, get ya, get ya, get ya: While the SMF presented the proposal as a targeted intervention focused on higher-risk gaming machines rather than a broad-based tax increase, critics argued it would instead amount to a severe financial shock for betting shops, casinos, bingo halls and adult gaming centers.
Regulus Partners analyst Dan Waugh said the SMF’s latest recommendations continued a pattern of flawed economic analysis and selective use of evidence.
“The SMF’s approach to tax policy is haphazard,” he said in a note responding to the report. “They appear to be making things up on the hoof.”
I will drive past your house: The report follows closely behind the SMF’s successful campaign for higher taxation of online gambling.
Last year’s Budget saw the government substantially increase remote gaming duty after ministers explicitly linked online casino products with gambling-related harms.
The decision prompted warnings from listed operators that higher taxation would reduce investment, damage competitiveness and strengthen the appeal of unlicensed operators.
The SMF now argues the same logic should apply to electronic gaming machines.
And if the lights are all down: Its proposal would leave lower-risk Category C machines, commonly found in pubs, at their existing 20% rate while introducing a new 40% band specifically for Category B machines found in betting shops, bingo clubs, arcades and casinos.
The organization said these machines are associated with disproportionately high levels of gambling harm and therefore warrant higher taxation.
I’ll see who’s around: The think tank also claimed the measure would improve the public finances twice over: first, through higher machine duty receipts and, secondly, because consumer spending would shift into other sectors that generate greater employment and higher tax revenues.
Its modeling estimates the economic cost of problem gambling linked to electronic gaming machines at £2.33bn annually.
This is compared with current MGD receipts of around £600m.
One day, maybe next week, I’m gonna meet ya: The report was accompanied by Survation polling that suggested 43% of UK adults support higher taxes on betting shop gaming machines, compared with just 11% who favor lower taxes, with support extending across all major political parties.
However, Waugh argued that both the economics and the politics behind the proposals deserve closer scrutiny.
He suggested the SMF has once again selectively designed its recommendations around political feasibility, exempting pub gaming machines while concentrating the burden on sectors with less political influence.
“It also appears opportunistic,” Waugh said, adding that the think tank had previously modified its recommendations to avoid opposition from horse racing.
Now it is proposing measures that could indirectly damage racing by weakening betting shop economics.
I’m gonna trick ya, trick ya, trick ya, trick ya: More fundamentally, Waugh disputed both the modeling and the assumptions underpinning the projected tax revenues. According to his analysis, the SMF appears to assume that doubling duty would have little impact on customer demand or on the supply of gaming machines.
In reality, he argued, many venues would simply become uneconomic.
“The upper estimate of the SMF’s duty forecasts appears to envisage zero impact on supply or demand from a doubling of duty,” he said.
This despite the fact that many bingo clubs, casinos, LBOs and arcades “would undoubtedly close.”
I’m gonna give you the slip: Whether ministers ultimately embrace the proposal remains uncertain. However, the SMF has established itself as one of the more influential voices in UK gambling policy debates. Its previous work advocating higher online gambling taxation anticipated measures that subsequently appeared in last year’s Budget.
It means its latest intervention is likely to receive close attention in Whitehall.
With the Treasury continuing to search for additional revenue ahead of future fiscal events, the SMF has once again provided policymakers with a detailed blueprint for higher gambling taxes.
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Miller’s crossing
A new career in a new town: The UK Gambling Commission has announced the departure of Tim Miller, its executive director of policy and research, who is set to join a consultancy, which the regulator was at pains to suggest would be outside the UK industry.
Consultant heal thyself: In announcing the news, the Commission said Miller would be taking on a “new role outside of the British regulated gambling industry, supporting governments, regulators and other organisations that are developing and overseeing gambling regulatory systems around the world.”
His departure comes a matter of months after the departure of CEO Andrew Rhodes, who also took up a role as a consultant, joining the newly set up Hawkbridge.
The Commission said it plans to appoint a replacement for Miller in the coming months.
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Guilty: Two people have pleaded guilty to cheating offences under the Gambling Act 2005 after using confidential information to bet on the date of the UK’s 2024 General Election. Former Conservative MP Craig Williams and Amy Hind, the wife of Conservative deputy digital director Anthony Hind, admitted the offences at Southwark Crown Court. The Gambling Commission said both exploited privileged knowledge to gain an unfair advantage in election betting markets.
The Major League Baseball Players Association has proposed banning individual player proposition bets across traditional sportsbooks, daily fantasy sports and prediction markets, during labor negotiations with MLB. The union said the measure would help reduce gambling-related harassment of players and coaches. It is also seeking clearer rules on player endorsements and sponsorships involving sportsbooks and prediction market operators.
Ukraine: A survey by the gaming regulator, PlayCity, found strong public backing for tighter gambling oversight, with 67% supporting increased regulation and 74% favoring stronger player protection measures. Respondents prioritized stricter iGaming regulation (29%), tackling illegal gambling (27%), higher minimum age limits (19%) and expanded responsible gambling education (15%). Among 3,164 respondents, 84% said they were not gamblers, while only 5% had gambled in the past year.
The Curaçao Gaming Authority has published its first dedicated cryptocurrency policy, setting AML and compliance requirements for licensed operators. Licensees may accept crypto only for gambling, not exchange or custody services. The framework mandates wallet screening, source-of-funds checks and bans funds linked to mixers, tumblers or sanctioned addresses. Operators have until June 2027 to comply fully.
Polymarket investigation
An open, not shut, case: The CFTC has opened an investigation into Polymarket, reviving questions over whether the prediction market operator is operating lawfully.
According to The New York Times, the inquiry began earlier this year and is extensive in scope, though few details have surfaced.
A Polymarket spokeswoman declined to comment to the paper on specifics but said the company was committed to accurate, fair and transparent markets.
That was then: A year ago, under then acting chair Caroline Pham, the agency killed a separate investigation into whether Polymarket was illegally serving US customers. This overruled its own enforcement attorneys, who had concluded the case should proceed.
Pham issued a directive barring the enforcement division from seeking further evidence through new subpoenas, then closed the inquiry.
Cleared: That retreat began soon after Donald Trump’s inauguration and Pham’s appointment in January 2025. Polymarket announced last July that both the CFTC and the Department of Justice had ended their probes, clearing the way for the company to launch a US platform via a subsidiary.
In August, it secured backing from 1789 Capital, the investment firm part-owned by Donald Trump Jr., who was named an unpaid adviser.
Last autumn, Pham’s office intervened to ensure the agency acted on a Polymarket request to broaden how it could accept bets.
Two senior officials who questioned the move were placed on administrative leave and put under internal investigation.
Three’s company: The new inquiry is the third into Polymarket in recent years. In 2022, the company paid a $1.4m fine for operating in the US without a license, under a settlement that barred it from taking US customers.
A Biden-era investigation into whether it had breached that ban ran alongside a DOJ criminal probe.
In November 2024, FBI agents seized devices belonging to founder and chief executive Shayne Coplan.
Taking the Michael: The disclosure increases pressure on Michael Selig, sworn in as CFTC chair last December, who has faced cross-party questioning over insider trading on prediction markets. He has pledged to pursue abuses, yet only individual traders have so far been charged.
In April, a US Special Forces soldier was accused of using classified information to win more than $400,000 on the operation to capture Venezuela’s president, Nicolás Maduro, placing bets via a VPN despite Polymarket’s purported ban.
In May, a Google engineer was charged over roughly $1.2m in similar trades.
The company said it prohibits insider trading and has made nearly 100 law enforcement referrals.
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New Mexico: Kalshi has moved to dismiss a lawsuit brought by four New Mexico tribes challenging its sports event contracts, arguing the products fall exclusively under the jurisdiction of the CFTC and cannot be restricted by tribal gaming laws. The company also contends tribes lack authority over businesses operating off tribal lands. The tribes allege Kalshi’s contracts violate the Indian Gaming Regulatory Act and tribal gaming compacts that prohibit online sports betting.
Congressional moves: Two bipartisan US senators have asked the CFTC to explain how it is overseeing Polymarket, following allegations of deceptive marketing. John Curtis and Adam Schiff cited reports that influencers were paid to promote simulated trades and exaggerated winnings without proper disclosure. The senators questioned whether the CFTC has sufficient authority and resources to regulate prediction markets and requested answers by July 10.
Block party: Meanwhile, a group of 17 Democratic senators has urged Congress to block the CFTC from using federal funds to sue states over prediction market regulation. Led by senators Richard Blumenthal and Jeff Merkley, the lawmakers proposed an FY27 appropriations rider to halt the CFTC’s litigation campaign, arguing it undermines state and tribal gambling laws and weakens consumer protections.
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Scam efforts
Nose to tail: Cambodia has stepped up its campaign against online scam compounds, presenting the effort as one of the country’s highest national security priorities amid growing international scrutiny over cyberfraud networks operating within its borders.
According to the Khmer Times, authorities said the crackdown is being coordinated through a dedicated Commission for Combating Online Scams, established by Prime Minister Hun Manet.
The strategy combines law enforcement, international cooperation and regulatory reforms.
Officials said the government has conducted nationwide raids targeting compounds used by transnational criminal organizations, many of which are staffed by foreign nationals trafficked into Cambodia under false employment promises.
The dragnet: Authorities claimed thousands of suspects have been arrested, hundreds of scam sites investigated and large numbers of foreign nationals deported or repatriated through cooperation with neighboring governments.
The campaign has focused on dismantling criminal infrastructure while freezing assets, prosecuting organizers and increasing intelligence-sharing with regional and international law enforcement agencies.
The government argued that online scam operations are highly mobile, well-funded and capable of relocating quickly in response to enforcement activity. Officials contend this makes eradication difficult and requires sustained operations rather than one-off raids.
Cambodia has also expanded cooperation with countries including China, Thailand and South Korea to identify trafficking victims, extradite suspects and disrupt criminal networks operating across multiple jurisdictions.
The Khmer Times also highlighted broader policy measures beyond enforcement, including tighter oversight of casinos and businesses suspected of facilitating cybercrime, enhanced border controls and increased monitoring of financial transactions linked to scam operations.
Authorities maintained these efforts demonstrate the government’s commitment to tackling a criminal industry that has damaged Cambodia’s international reputation and threatened legitimate investment.
Calendar
Jul 8-11: NCLGS summer meeting, San Diego
Jul 22-24: NCPG Annual Conference, Nashville
Nov 10: Gaming in Germany, Berlin
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