From gambling duty to stablecoins and APP fraud, here are the Autumn Budget 2025 measures UK payment firms in high-risk sectors need to watch.
As Rachel Reeves stands up to deliver her second Autumn Budget on November 26, the headline debate will be about ‘stealth’ tax rises and welfare reform.
For payment firms, the more important story sits underneath – how this Budget knits together the new retail payments strategy, crypto and stablecoin rules, gambling tax reform and the government’s evolving fraud response.
Below are the five areas Payment Expert readers should have at the top of their notes.
1. Gambling duty reform: tax grab or structural reset?
If Reeves wants to raise money without touching the main rates of income tax, VAT or corporation tax, gambling is an obvious target. She is under heavy pressure from think tanks and Labour backbenchers to increase the overall tax burden on the £15bn UK gambling industry, and to use the proceeds to fund child poverty and NHS commitments.
The UK Treasury has already consulted on moving to a single tax for UK-facing remote gambling, replacing the current patchwork of remote gaming duty, general betting duty and pool betting duty. The policy rationale is simplification and better alignment with how online gambling actually works today.
At the same time, multiple external proposals have argued for significant rate hikes. The Social Market Foundation and others have modelled scenarios that would raise remote gaming duty from 21% to as high as 50% and harmonise betting tax at a higher level, suggesting this could raise £2–3bn a year.
Media reports now broadly expect some combination of higher duties and a reworked remote levy, despite industry warnings about black-market migration and the impact on horse racing and jobs.
Why it matters for payments:
- Higher duties or a new single remote tax would change operators’ P&Ls overnight, which typically drives rapid reviews of PSP relationships, fees and risk appetite.
- Any material rate hike could accelerate consumer leakage to offshore or unlicensed sites, increasing exposure to high-risk traffic for PSPs and acquirers sitting on the edge of the regulated market.
- The interaction between a new tax structure and the statutory gambling levy will matter for how compliance and safer gambling spend is accounted for and funded.
Watch for: the exact structure of any new “single” remote duty, transitional arrangements, and whether the Budget signals further work on the levy or leaves that to the Department for Culture, Media and Sport.
2. Fraud, APP scams and digital ID: will funding catch up with rhetoric?
Reeves is briefing hard on a tougher stance on benefit fraud, with leaks pointing to a package which aims to raise around £1.2bn via more aggressive Department for Work & Pensions investigations and debt collection.
Yet there is growing criticism that successive governments have under-invested in tackling private-sector fraud, even as losses from scams, APP fraud and synthetic ID attacks climb, turbocharged by generative AI. UK Finance has openly called current public investment “not commensurate” with the scale of the threat.
The Mansion House financial services strategy already flagged digital identity and smarter use of data as tools to cut fraud and AML costs, with personal digital ID expected to deliver billions of pounds in savings across the economy.
Why it matters for payments:
- The PSR’s APP reimbursement regime is now in force; without extra funding or policy support, banks and PSPs will argue the system is lopsided, with liability shifted to them but limited investment upstream in policing, telecoms or big-tech accountability.
- Any Budget money for the National Fraud Squad, NCA, FCA, PSR or a national fraud data-sharing platform would be a tangible signal that government is willing to shoulder more of the burden.
- Explicit references to digital ID roll-out, and how it ties into AML and KYC rules, could accelerate timelines for banks, PSPs and high-risk merchants.
Watch for: line-items on fraud enforcement, digital identity, money-laundering regulations and any new cross-sector fraud levies or “polluter pays” style contributions.
3. Crypto, stablecoins and tokenised payments: from vision to timetables
2025 has already been pivotal for the UK’s digital assets regime. In April the government published draft legislation for bringing a broad range of cryptoasset activities, including exchanges and custody, into the UK’s financial services perimeter, positioning this as core to its “Plan for Change” and FinTech growth agenda.
In parallel, the Financial Services Growth & Competitiveness Strategy and the Leeds Reforms promised a modernised payments and e-money framework that explicitly responds to tokenised payment instruments such as stablecoins. The Bank of England has since sketched out a cautious approach, signalling that caps on individual stablecoin holdings will only be relaxed once it is confident there is no threat to financial stability.
Why it matters for payments:
- High-risk sectors such as gambling, gaming and cross-border e-commerce are natural early adopters of fiat-referenced tokens once rules are clear.
- PSPs, EMIs and acquirers are already building tokenisation and “multi-money” capabilities; what they need now is regulatory certainty on authorisations, capital, safeguarding and resolution.
- Clarity on VAT and corporation tax treatment of cryptoasset income remains a pain point for both regulated firms and merchants.
Watch for: any Budget language that (a) puts dates on final crypto legislation, (b) links fiscal policy to the emerging stablecoin regime, or (c) references cross-border tokenised payments as part of the wider retail payments strategy.
4. The new retail payments strategy, open banking and account-to-account
Just two weeks before the Budget, the Payments Vision Delivery Committee – bringing together HMT, the Bank of England, FCA and PSR – set out its strategy for the next-generation retail payment infrastructure. Five outcomes anchor that vision, including greater choice of “innovative and cost-effective” payment options, interoperability between new and existing forms of digital money, and stronger protection from financial crime.
One of the standout themes is support for account-to-account payments at point of sale via open banking, alongside explicit reference to tokenisation and stablecoins in the multi-money ecosystem.
Why it matters for payments:
- Budget backing – even if only in the form of political airtime and modest funding – would signal that this retail payments roadmap sits near the top of the growth agenda, not buried in regulatory plumbing.
- For card schemes and acquirers, any hint of government enthusiasm for card-alternative rails will be read alongside the ongoing debate over interchange, scheme fees and merchant surcharging.
- For high-risk verticals, the combination of A2A, digital ID and smarter data could materially reshape how affordability checks, risk scoring and transaction monitoring are done.
Watch for: references to the National Payments Vision, open banking or open finance in the speech or accompanying documents, and any specific funding or timelines linked to A2A at POS.
5. The indirect levers: business tax, bank surcharge and regulatory cost
Reeves has signalled she does not intend to touch the main rates of income tax, NI, VAT or corporation tax, which pushes the Treasury towards more targeted levers. For payments and fintech firms that could mean:
- Business tax certainty vs. new surcharges: industry bodies are lobbying for a commitment not to raise business taxes further, including the bank surcharge, to support investment. Others expect more “windfall-like” tweaks focused on the City.
- Compliance load from new regimes: the FinServ Growth Strategy and Mansion House package contain promises to modernise payments law, tweak the Senior Managers Regime and streamline authorisations. The Budget may choose to highlight these as “non-tax” growth drivers – but firms will be watching closely for how much regulatory simplification actually materialises in statute versus guidance.
For high-risk PSPs and acquirers already grappling with card scheme rule changes, APP reimbursement, gambling reforms and impending crypto rules, even marginal changes to surcharge / levy structures or supervisory fees can tilt business models.
Watch for: any references to the bank surcharge, economic crime levy, FCA/PSR funding and the cost of compliance for “innovative” firms.
