An increase in machine games duty (MGD) has come to pass, but not to the extreme level that was previously speculated. Yet, many industry stakeholders have expressed concern about the consequences of Chancellor John Healey’s MGD uptick to 25%, scheduled for 1 April 2027.
The industry previously feared that MGD would rise to the proposed levels by the think tank Social Market Foundation of 40%, but that isn’t the case.
The Office of Budget Responsibility (OBR) has forecast that betting and gaming receipts are expected to raise £5bn in 2026-27, a 31% increase relative to 2025-26, ‘driven by the increase to tax rates on remote gambling announced at Budget 2025’.
OBR forecasts receipts to grow by 3.4% on average a year to £6bn in 2031-32, higher by an average of £0.2bn compared to the March forecast before the impact of policy measures, ‘largely due to stronger-than-expected remote gaming duty receipts, suggesting a slower-than-expected reduction in activity in response to the rate increase’.
“The increase to machine gaming rates announced at this Budget increases receipts by a further estimated £0.1 billion a year from 2027-28,” added OBR.
However, operators and industry trade bodies have pushed back against the MGD increase.
Entain: Another disappointing decision
Entain has responded to the government’s MGD increase, noting that it’s ‘disappointed’ by the decision and that it will have ‘a detrimental impact on the wider industry, UK high streets, jobs and livelihoods, compounding the pressures the sector is already facing’ following last year’s remote gaming duty increase.
The Ladbrokes and Coral operator estimates an annualised additional cost to its UK&I Retail business of approximately £25m due to the MGD increase, before any mitigating measures, but it ‘anticipates an opportunity for customer recapture as peers re-evaluate their UK market presence’.
Entain expects to fully mitigate the latest tax increase impact by the end of 2028, following ‘estate rationalisation, group-wide optimisation initiatives and potential market share gains’, while its FY26 guidance and expectation of generating £500m annual adjusted cash flow in 2028 remain unchanged.
Stella David, Chief Executive Officer of Entain, commented: “This is another disappointing decision by the government. The previous gambling tax increases announced in November last year have already had detrimental consequences across the industry, with the effects being felt by employees, communities as well as customers.
“These additional tax changes will further compound that damage and push more people into the growing illegal market. We will continue to work hard to limit the impact of these changes on our business, our people, and the communities in which we operate. Our priority is to protect jobs wherever possible whilst supporting a sustainable retail presence on UK high streets.”
BGC: Venues and jobs at serious risk
The Betting and Gaming Council has also pushed back against the MGD rise, stating that it will put casino ‘venues and jobs at serious risk and undermine planned investment, despite recent Government reforms designed to encourage growth’, with closures in the North of England and Scotland, as well as previously closed venues still standing empty.
In addition, the BGC stated the tax rise will put further pressure on support for British sport, as well as only ‘make the illegal gambling market more attractive to customers’.
Grainne Hurst, CEO of the BGC, noted: “This is a deeply damaging decision and a blow to the thousands of workers, businesses and communities who depend on Britain’s regulated betting and gaming industry.
“The Chancellor has ignored repeated warnings about the consequences. At 25%, EY projects almost 9,000 people could lose their jobs and almost 1,000 betting shops and casinos could close or be at serious risk. These are real people and families facing the loss of their income and security, in places where alternative work can be hard to find.”
Hurst added: “We already contribute £6.8bn to the British economy, generate more than £4bn in tax and support 109,000 jobs. Yet the Government has chosen a course that will destroy jobs, close businesses and diminish the industry’s contribution to the economy.
“The Chancellor has chosen a tax rise that will cost British jobs, close businesses and hollow out high streets, while handing an advantage to illegal operators. The Government cannot ignore the consequences of this decision.”
Bingo Association: A serious blow to bingo
Bingo halls will also be impacted by the MGD rise, with The Bingo Association stating that the increase will be ‘a serious blow to bingo and the communities that rely on their local club’.
The association noted that despite bingo duty being abolished in the last budget, loss-making clubs is expected to rise to 77, while £50m committed by operators to clubs this year outside of London and the South East will fall away and close, while ‘clubs in the Midlands and the North will be hit hardest’.
The Bingo Association stated: “Today shows why clubs struggle to plan ahead. Every Budget, land-based gambling is put up as an easy source of revenue in a way no other part of leisure or hospitality is, and that uncertainty makes long-term investment impossible. The Government needs to set out a clear, long-term position on gambling taxation that recognises the economic contribution of land-based venues.
“Clubs tackle social isolation and loneliness, particularly for older customers. We will work through the impact with our members, and we urge the Government to work with us to protect the clubs, jobs and communities now at risk.”