UK Treasury Sets £655m Five-Year Target with 25% Machine Gaming Duty Rise from April 2027
UK Treasury targets £655m over five years via 5% MGD rise to 25% on higher-stake machines from April 2027, affecting 5,100 operators. Move funds high street relief but lacks quantified harm reduction data. BGC warns of 9,000 job losses and nearly 1,000 site closures per EY modelling.
SCCG Take — The duty hike favours revenue simplicity over full business impact review, leaving operators exposed to further threshold tweaks after two years. Regulators should track whether projected receipts materialise without accelerating shifts to unregulated channels.
According to reporting by SBC News, HM Treasury believes it can secure a total of £655m from a five-year cycle generated by a new tax rise on Machine Gaming Duties (MGD). The government published its key considerations on the decision to increase the rate by 5% to 25%, as announced by Chancellor of the Exchequer John Healey in the Autumn Budget on 28 October. Healey tied the hike to funding a package of relief measures for high street businesses, including raising the business rates threshold from £12,000 to £18,000 for retail, hospitality and leisure venues, while excluding arcades, betting shops and vape shops.
The changes take effect from 1 April 2027. Machines allowing stakes above £1 or prizes above £100 will face the 25% rate, principally hitting Category B types. Category C and D machines retain the 20% duty for £1 stakes and prizes below £100. The Treasury frames the policy around three principles: applying a lower targeted risk on gambling, unifying gaming machines under a common tax threshold, and using an established system for effective collection.
Revenue Goals and Recognised Risks
The Office for Budget Responsibility has certified additional receipts of £135m in 2027/28, followed by £130m annually for the next four financial years. HMRC estimates the measure will affect approximately 5,100 operators across 12,400 active premises. The assessment notes that businesses could adjust returns to players, with some customers gambling less or switching products. It states higher stakes and prizes carry greater gambling harms yet offers no quantified reduction in harm expected from the tax change. The government judges there will be no significant macroeconomic impacts, though this does not address consequences for individual businesses or local employment.
Industry Warnings on Jobs, Closures and Further Tax Exposure
The Betting and Gaming Council responded that modelling by auditor EY indicated almost 9,000 jobs could be lost and nearly 1,000 betting shops and casinos could close or face serious risk of closure. BGC CEO Grainne Hurst called the increase “a deeply damaging decision and a blow to the thousands of workers, businesses and local communities.” The trade body warned of undermined casino investment and greater appeal for illegal gambling operators. HMRC will monitor data for two years before assessing revenue effects, but the Treasury has preserved flexibility to adjust machine stake and prize thresholds with no commitment to freeze gambling duties. After a decade of regulatory and tax changes, the sector has no guarantee of stability.
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