Over 100 Labour MPs Urge Gambling Tax Hike to Scrap UK Two-Child Benefit Cap

Over 100 Labour MPs, including eleven Scottish members, have signed a letter urging Chancellor Rachel Reeves to introduce a super-tax on gambling industry profits to fund the abolition of the two-child benefit cap, a policy widely criticized for perpetuating child poverty. The MPs support a proposal led by former Prime Minister Gordon Brown and backed by the Institute for Public Policy Research, which suggests increasing gambling taxes significantly to raise around £3.2 billion needed to scrap the cap. The letter highlights the gambling industry's high profitability, low employment contribution, and tax advantages due to offshore operations, arguing that the sector's excessive profits come at a substantial public cost, including over £1 billion annually in gambling-related harms. Despite the child poverty taskforce recommending the cap's removal as the most effective poverty alleviation method, political and fiscal challenges, including Chancellor Reeves's budgetary constraints, have delayed official decisions. Labour's internal divisions over the policy and the taskforce's delayed report have further complicated the issue's progression toward resolution. The MPs call for fairer gambling taxation to reduce harm, tackle poverty, and ensure funds are redirected to support vulnerable children and families.