UK betting companies have taken sharp hits to their stock prices after reports emerged that the government was considering hefty tax hikes on gambling operators.

Almost £3bn ($3.92 bn) was wiped off the value of UK gambling stocks following a report in The Guardian which claimed that Chancellor Rachel Reeves was under pressure from leading think tanks to squeeze the betting industry with tax increases.

Flutter Entertainment, which is listed on the New York Stock Exchange, fell by 9% on Friday when the report emerged. When UK index FTSE opened on Monday, Entain fell by 14%, while Evoke also suffered a 12% haircut.

urged more than doubling taxes on “higher harm” products

The report stated that the Institute for Public Policy Research, a left-leaning think tank, had urged more than doubling taxes on “higher harm” products such as online casino games, while exempting items such as lotteries and bingo.

Another think tank, the Social Market Foundation, proposed doubling the tax on online gambling companies.

Financial services group Jefferies, however, questioned the likelihood of such severe actions saying that they would “effectively wipe out listed operator profitability and likely pose an existential threat to many smaller operators.”