Split in gambling lobby emerges as senior racing figures oppose level taxes and flag dangers of online casinos

A schism has opened up at the heart of the £11.5bn-a-year gambling industry, after senior figures in horse racing broke ranks and signalled they would no longer object to tougher taxes and regulation of online casinos.

In a surprise development, likely to cause headaches for multibillion-pound companies such as Flutter and Entain, some of the most powerful figures in racing in effect turned their backs on digital slot machine and casino products.