Betfred Pulls Derby Sponsorship as Gambling Tax Warnings Come True

Betfred has just announced it will end its sponsorship of all five British Classics. This follows the latest increase in gambling taxes and warnings from founder Fred Done.

Betfred’s sponsorship withdrawal delivers an early blow to British horse racing, especially after repeated warnings about the financial consequences of higher duties.

The bookmaker confirmed on Thursday, 5 November, that it would not renew its sponsorship agreements covering the classics. That is; the Derby and Oaks at Epsom, the 2,000 and 1,000 Guineas at Newmarket, and the St Leger at Doncaster.

The decision follows the government's announcement that Machine Games Duty (MGD) will increase from 20% to 25% for higher-stake machines from April 2027.

It also marks a significant setback for British racing, which has repeatedly warned that gambling tax increases could result in betting shop closures, reduced sponsorship and millions of pounds in lost revenue.

Betfred Follows Through on Sponsorship Warning

Betfred founder Fred Done warned in September that the bookmaker would be forced to withdraw from sponsoring the five Classics, if the government increased MGD.

At the time, Betfred was discussing a three-year renewal with the Jockey Club and Arena Racing Company, which operate the racecourses hosting the events.

Although the government stopped short of increasing MGD to 40%, as some campaigners had proposed, the smaller rise was still enough to prompt Betfred to abandon the agreement.

In a statement, the bookmaker said:

‘Following successive tax rises for the betting industry - and in particular the increase to machine games duty at the most recent budget - it is with great sadness that we have taken the difficult decision not to proceed with a three-year renewal of our sponsorship of the British Classics.’

The company previously estimated that the increase to 25% MGD would make 284 of its 1,094 remaining betting shops unprofitable, potentially putting 1,420 jobs at risk.

British Horse Racing Warned of £57 Million in Annual Losses

The withdrawal provides an early example of the financial consequences that racing organisations warned could follow higher gambling taxes.

In October, the British Horseracing Authority published research from Regulus Partners estimating that increasing MGD to 40% could cost British racing £92 million annually. Following the Budget on 28 October, the BHA revised its concerns to reflect the smaller 25% increase.

In its official response, the organisation warned that racing could still lose £57 million annually. BHA Chief Executive Brant Dunshea said that although the government had rejected the worst-case proposal, the increase would nevertheless cause significant financial damage.

According to the BHA, nearly a third of British racing's £350 million annual income from betting comes through high-street betting shops.

The organisation has warned that widespread closures could affect prize money, racecourse finances, employment and horse welfare programmes.

What Happens to the Derby and Other British Classics?

Betfred became the title sponsor of the Derby, Oaks, and St Leger in 2023, before adding the two Guineas races in 2025.

The agreement made Betfred the first bookmaker to sponsor all five British Classics simultaneously, fulfilling a long-standing ambition of founder Fred Done.

The decision to withdraw leaves some of the country's most prestigious Flat races seeking new commercial partners. The Jockey Club, which operates Epsom and Newmarket, has confirmed that discussions with prospective replacement sponsors are already underway.

Amy Starkey, Managing Director of the Jockey Club's London hub, expressed disappointment at Betfred's decision, but acknowledged the bookmaker's reasons for withdrawing.