A group of 101 Labour MPs have thrown their weight behind a call by Gordon Brown for the government to hike taxes on betting companies in order to tackle child poverty.

In a letter to the chancellor, Alex Ballinger and Beccy Cooper of the All-Party Parliamentary Group said there is a “compelling” case for a “targeted levy on harmful online gambling products” and that the money raised should be used to scrap the two-child benefit cap.

MPs argue that while betting companies in the UK have seen their sales grow significantly in recent years, they employ relatively few people, are often located outside the UK in order to minimise their tax bills, and therefore bring “little value to the UK economy”.

The MPs who signed the letter represent almost half of Labour’s 235 backbenchers – ramping up pressure on the chancellor to take action. 

“No child should be growing up in poverty while gambling companies continue to enjoy record profits,” says Alex Ballinger, MP for Halesowen.

He added: “Harms from gambling place a huge burden on our public services, costing the Exchequer over £1 billion a year. 

“It’s time to confront these excessive profits, reduce gambling-related harm, tackle poverty, and ensure gambling is taxed fairly.”

The group of MPs believe the gambling industry in the UK is “lightly taxed” compared with other countries, and they want Chancellor Rachel Reeves to introduce the changes recommended by the Institute for Public Policy Research (IPPR), a think tank.