Christian charity CARE has expressed concern as a proposal to impose a statutory levy on betting companies has reportedly been ditched.
Ministers are poised to announce a long-awaited whitepaper on reform of Britain's outdated gambling legislation.
New limits on betting are expected to include a maximum stake of between £2 and £5 for online casinos, a ban on free bets and VIP packages, and affordability checks.
However, a proposed levy of one per cent per annum on the gambling industry to pay for addiction treatment and research has reportedly been withheld.
Ministers also appeared to ditch a plan to ban gambling companies from sponsoring Premier League football shirts.
Ross Hendry, CEO of CARE told Premier Christian News: "We will reserve our full judgment on the whitepaper until it is published but if today's reports are anything to go by, it looks like the proposal will be missing teeth.
"The reported maximum stake for online casinos and ban on dangerous incentives like free bets are welcome measures that will help protect the vulnerable.
"But many groups called for a statutory levy on firms, which pay a pittance towards services for people experiencing problem gambling.
"A just levy should form the backbone of reforms to our laws, which are no longer fit for purpose. Ditching the 'polluters pay' tax would amount to a betrayal of punters.
"We urge Ministers to think again. The interests of a powerful gambling lobby must not be prioritised over the welfare of the British public."