UK's Chancellor raises tax on gaming machine duty to 25%

• The new British budget includes an increase to the Machine Games Duty, which is now set at 25%
• The measure will have a serious impact on the industry, argues a prominent trade group
• As many as 11,000 jobs may be at risk while the future of land-based betting shops is uncertain

The Chancellor of the Exchequer, John Healey, has posed for the customary photo-op with his hand extended, clasping the red briefcase, which contains Budget 2026.

In it, the Chancellor had laid out the plans for raising the Machine Games Duty, a tax on the net takings from specific slot machines, to 25% from currently 20%, which has prompted a swift response from the industry.

BGC criticizes latest changes to UK gambling tax

The Betting and Gaming Council (BGC), a trade group, has immediately announced itself against the measure, calling it counterproductive, with almost 9,000 people now looking at potential job losses, and up to 1,000 betting shops and casinos potentially affected.

The measure is expected to drive further revenue streams to the Budget, and comes on top of the previous tax increase of 40% on Online Gaming Duty, affecting iGaming operations of licensed operators.

Together, the two measures put the industry in a difficult spot, argue the BGC, with many already resorting to job cuts. The BGC argued that the tally of these measures was much higher, arguing that as many as 11,000 jobs have either been cut or are at risk of being cut.

Betfred has previously commented that the high street betting shops are disappearing, a trend that is likely to now be precipitated by the current Budget. Flutter Entertainment has announced that it will be letting go of up to 1,400 people.

Commenting on the matter, BGC Chief Executive Grainne Hurst added: "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.

For Britain’s casinos, the consequences will be significant. These are major employers and important contributors to local economies, yet this decision will force otherwise viable businesses to close and undermine investment before it can be delivered."

Hurst may have a point, as companies have announced a series of layoffs, outwardly attributing them to the increased taxation in the United Kingdom, with evoke, Betfred and bet365 among the companies to have confirmed such cost-trimming initiatives.

Jobs and livelihoods threatened - illegal market a winner

The changes to taxation come at a time when the country is also struggling to rein in the illegal gambling market locally, which has arguably been expanding.

"Higher taxes on the regulated industry also will make the illegal gambling market more attractive to customers, where operators pay no UK tax, contribute nothing to British sport and offer none of the safeguards required of licensed businesses," Hurst added in her statement.

Despite these warnings, however, the UK is unlikely to change tack when it comes to taxing the gambling industry, at least not in the foreseeable future. A silver lining is that the regulator, the Gambling Commission, has acknowledged the challenges posed by the black market and will seek ways to address the issue.

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