The answer is both yes and no I'm afraid. From a legal standpoint the answer is most definitely yes, spread betting is considered gambling under UK law and as such is not subject to capital gains or income tax. However from a practical standpoint the answer is very much no, there is no real difference between buying shares through a broker (investing) or buying them through a spread bet provider. The method may be slightly different and you may be using leverage , but practically it is the same. The reasoning behind this difference is most spread bettors tend to be retail clients who lose and therefore to prevent this money being offset against gains in other areas the government classes it as gambling.
In a similar light, rather than charging stamp duty on each transaction the government charges betting duty on the UK spread betting company, so in a sense a tax is paid but it is indirect to the customer whilst in shares that tax is direct on the customer. This makes spread betting a highly attractive form of speculating. The key difference between spread betting and gambling in a casino is, in a casino the odds are fixed the casino has an edge. In spread betting the odds are not fixed, the spread betting company takes the part of a book keeper but rather than holding the risk passes it onto the market. Almost all the major providers now do not hold your positions like a casino, rather they act more like brokers passing almost all the risk to the market. In this sense therefore the only idea of an edge is if you view the stock market having an overall edge against speculators, investors etc.
If you manage your risks well, don't over leverage and have a understanding of the market this can be an extremely tax efficient and profitable exercise. Moreover, because of these advantages buying futures can be extremely cheap even for annual investments due to the tax efficiencies. There is also a further advantage if you want to invest in funds. If you invest directly they will charge you fees which can range from 0.5 – 1.5% annually. However as spread betting means you only buy based on the prices of funds there are no annual fees, only interest charges for the borrowing of money to invest. Hence there is no real difference in practice to buying shares as gambling.