Super Group sees a UK opening as tax pressure reshapes competition

The tax backdrop has developed over several years. The December 2014 reforms moved remote gambling duties onto a place-of-consumption basis, bringing gross gambling profits from UK customers into scope regardless of where the operator was located. ⁴ Remote Gaming Duty subsequently rose from 15% to 21% in April 2019. ⁵

The latest increase, from 21% to 40%, took effect on 1 April 2026. It applies to the defined remote-gaming duty base, rather than to every pound deposited or wagered. ⁴

Super Group had already acknowledged the cost. In its response to the November 2025 announcement, it estimated an approximately 6% impact on 2026 group adjusted EBITDA and said mitigation measures were under way. ³ That was management's estimate at the time, concerning a company-defined earnings measure across the group. It is not a disclosed calculation of today's UK profit.

The new interview adds a competitive response to that earlier cost warning. If some businesses decide that their remaining earnings no longer justify operating in Britain, the surviving operators may have opportunities to attract their customers. A tax increase can therefore damage an operator's economics while changing the competitive field around it.

That does not make all the departing revenue available to the remaining firms. Customers can choose other activities, spend less or stop. Winning their attention also has a cost.

A simple illustration shows why the distinction matters. Assume an unchanged £100 remote-gaming duty base and apply the former and current rates:

Our calculation using HMRC's rates. The remaining amount is before technology, staff, marketing and other costs; it is not net profit. ⁴

Holding everything else constant, the taxable base would need to reach approximately £131.67 to leave £79 after a 40% duty charge. That is an increase of roughly 31.7%. This isolates the change in duty and makes no allowance for additional costs associated with serving more customers.

The calculation cannot be applied directly to Super Group's reported UK revenue growth. The interview does not provide the company's UK duty base or a standalone UK profit figure, and sports betting has a different duty framework. Published quarterly results include regional revenue figures, including Europe, without a separate UK profit calculation. ¹²

The example nevertheless explains why capturing more business may be necessary simply to defend earnings. A company can improve its position relative to competitors while retaining less from an equivalent amount of taxable gaming activity.

Market concentration can increase through changes in where customers spend, as well as through acquisitions. If an operator leaves and its customers choose a surviving brand, that brand can grow without purchasing the departing company.

Super Group brand
The UK interview discusses Betway alongside the group’s Spin casino businesses.¹

Menashe's interview describes an opportunity of that kind. He also outlined a conservative approach to acquisitions, saying the group wanted businesses to fit its existing operation and had found valuations unattractive in previous discussions. ¹ Capturing customer demand and buying another company are separate routes to expansion.

The first route avoids a purchase price and the work of integrating an acquired business. It still requires a proposition customers want to use. An operator has to be visible, provide a good service and retain new customers at an acceptable cost. The disappearance of a competing brand does not transfer its relationships automatically.

Internal consolidation could help with those economics. Shared systems and teams can spread common operating costs across more activity and reduce duplicated work. These are the mechanisms through which efficiency could support Menashe's argument; the interview does not quantify the savings from each one.

The duty itself remains a proportional charge. Putting more business through a shared operation does not reduce the statutory rate. Efficiency improves how the company uses what remains after duty and other variable costs.

Size is useful only when the organisation can translate it into lower costs or a better product. A large business with expensive legacy systems can still be vulnerable. A focused smaller operator may be efficient. The competitive advantage belongs to the operating model demonstrated in practice.

To establish a market-share gain, Super Group's growth needs comparison with a suitably matched UK market total. To attribute that gain to competitors' departures requires evidence about where the additional business came from. The interview does not isolate those effects from changes in spending, product mix, sporting outcomes or currency.

Profitability requires another layer of information. More revenue can be accompanied by greater marketing expenditure, higher duty and the cost of serving additional customers. Revenue gained through an expensive campaign may have very different value from an existing customer choosing to stay.

The next tax stage also remains relevant. A separate 25% remote-betting rate is scheduled from April 2027, with exclusions including UK horseracing. ⁶ A quarter after the casino-duty increase cannot establish how the complete package will affect the group's future UK returns.

HMRC's policy paper sets out revenue-raising and public-protection objectives. Its impact assessment also recognises that operators may pass costs on through worse betting odds or casino returns, and that customers could respond by gambling less, switching activities or using the illegal market. ⁶ Those are possible responses identified in the assessment, rather than observed destinations for every departing operator's customers.

Our analysis of the UKGC's Illegal Gambling Index explains why participation measures cannot, by themselves, establish a tax effect.

That makes customer behaviour central to the argument. Fewer competing brands may create an opening, but the remaining operators still have to persuade people that their services are worth using.

Super Group's argument is strongest as a case about relative efficiency. A company able to operate profitably under tougher conditions may gain room to grow as competitors withdraw. That can happen even if the sector's overall commercial returns deteriorate.

It would overstate the evidence to call the UK tax increase beneficial to Super Group on the strength of one revenue comparison. The company faces the higher charge too. The opportunity is to build enough valuable business, at a sufficiently controlled cost, to improve the outcome it would otherwise have faced.

We would therefore judge the strategy through customer retention, acquisition costs and UK earnings after duty. More detailed disclosure on those points would make the investment case easier to assess. Continued revenue growth would be encouraging, but sustainable earnings would demonstrate whether the operating advantage is real.

For British readers, the wider significance is how tax pressure can change the shape of competition without a headline takeover. Menashe has identified a plausible route to a stronger position. Turning it into durable profit remains the test.

Prepared with help from ChatGPT.