UK Chancellor Weighs Machine Games Duty Increase Ahead of October Budget

UK Chancellor John Healey is considering an increase in Machine Games Duty on slot machines ahead of the government’s Oct. 28 budget. The Treasury is seeking additional revenue amid tight public finances, as first reported by The Times.

The examination follows proposals from the Social Market Foundation to double the tax on Category B machines from 20% to 40%. Such machines permit a maximum £2 ($2.71) stake every 2.5 seconds. A government source told The Times: “Increases in gambling taxes are definitely on the table again.”

Differential Exposure Across Venues

The source suggested adult gaming centres could be particularly exposed while bingo halls and pubs might receive carve-outs. The source said: “Andy hates adult gaming centres. But, like all politicians, he loves bingo halls and pubs. They would probably need carve-outs if they do go after machine games duty.”

Former Chancellor Rachel Reeves had considered raising taxes on slot machines but instead increased online gambling taxes to 40%, effective in April. The industry has attributed many betting-shop closures to those online tax rises, along with higher energy costs and national insurance. Betting shops face longer-term decline as consumers shift to online gambling, a trend accelerated by the COVID-19 pandemic. Adult gaming centres have faced additional pressure from moves to scrap “aim-to-permit” licensing.

Modelling by Regulus Partners has argued that tax increases on the proposed scale could result in the majority of betting shops and adult gaming centres closing nationwide. This could limit or eliminate the expected tax revenue increase. The Betting and Gaming Council fundamentally opposes any increase in Machine Games Duty. It warns that higher taxes could lead to further closures and job losses, weaken high streets and benefit illegal gambling.

A Treasury spokesperson said the government would set out its decisions at fiscal events rather than comment on rumours or proposals.

Revenue Goals Versus Retail Risks

Any duty increase carries the risk that widespread closures offset the intended revenue. Industry modelling underscores this limitation specific to the proposed doubling on Category B machines. The October budget will reveal whether carve-outs for certain venues materialise or whether retail operators confront accelerated contraction.

Reporting: Yogonet International

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