UK raises Machine Game Duty five percentage points to 25% from April 2027

The UK Government announced a five percentage point increase in Machine Game Duty (MGD), raising the rate to 25%, and the measure will take effect in April 2027. Chancellor John Healey confirmed the change as part of the Autumn Budget; the rise is far smaller than the 40% increase that had been discussed over the summer.

What has changed and when

John Healey presented the measure as part of the autumn budget package that, according to the Government, seeks economic stability and business tax reform. The MGD increase will apply to Class B machines, which are the most common in betting shops and gaming arcades in the United Kingdom. The rise will be implemented from April 2027.

The Government also announced business rates reforms: the threshold for small business rate relief will rise from £12,000 to £18,000, and around 70,000 businesses will exit the rates system entirely. This will sit alongside a 20% reduction in business rates that the Government had already introduced when Andy Burnham assumed office.

Adult gaming centres will cease to qualify for any relief on business rates; the Government has indicated these premises, along with vape shops, are excluded from the benefit.

Industry reaction and figures cited

The Betting and Gaming Council (BGC) described the increase as “deeply damaging”. Grainne Hurst, chief executive of the BGC, cited independent modelling by EY that estimates close to 9,000 job losses and suggests around 1,000 betting shops and casinos could close or face significant financial pressure.

Entain published its own estimate: the tax change will cost its retail business in the UK and Ireland approximately £25m a year. Stella David, CEO of Entain, warned the measure could harm jobs, high streets and the regulated sector, and might increase the appeal of illegal operators. Entain said, however, that it plans to mitigate the impact through network rationalisation and operational efficiency improvements.

The Bingo Association expressed concern about bingo clubs’ ability to invest. Nicole Garrett, chief executive of the association, said clubs had already received mixed signals from the Government: in April Bingo Duty was removed and support for British bingo was promised; six months later, much of that support would be offset by the new tax burden, Garrett said, putting hundreds of jobs at risk, particularly in the Midlands and the North.

The British Horseracing Authority (BHA) warned about the impact on horseracing competition. Brant Dunshea, chief executive of the BHA, noted that the turf receives around one third of its annual funding—about £350m—from contributions of street betting, and estimated that the MGD increase could reduce revenues by up to £57m a year. Dunshea warned that a decline of that scale could affect prize money, racecourse operations, employment and equine welfare programmes. The BHA said it will engage with the Government to seek measures that reduce the tax change’s impact.

Regulatory context and recent tax changes

The confirmation of the MGD rise follows a series of tax changes that have already increased pressure on the sector. In last year’s Autumn Budget, then-chancellor Rachel Reeves raised Remote Gaming Duty (RGD) from 21% to 40%. In addition, a new General Betting Duty for remote bets is due to take effect soon at 25%, up from the previous 15%.

Much of the speculation about a 40% rise in MGD came from a Social Market Foundation report published earlier this year. The confirmation of a five-point rise allayed fears of that magnitude, although it raised concern about the cumulative effect when combined with other fiscal measures.

Political and sector positions

The All-Party Parliamentary Group on Gambling Reform welcomed the MGD increase and the removal of business rate relief for adult gaming centres. The group has advocated higher taxes on gambling products associated with greater social harms; Alex Ballinger MP, co-chair of the group, had recently called for a doubling of MGD.

The Government presents the measures as a way to enable tax reliefs for small businesses and to reorient support toward high streets. Healey defended the budget package as policy that will allow the small business rate relief threshold to rise while maintaining stable fiscal policy.

“This decision is a blow to thousands of workers, businesses and communities who rely on Britain’s regulated betting and gaming industry,” said Grainne Hurst, according to the Betting and Gaming Council statement.

“These additional tax changes will further compound damage and push more people into the growing illegal market,” said Stella David, CEO of Entain.

What comes next

The MGD increase will become law in April 2027; in the months beforehand operators and trade associations are expected to quantify impacts on their portfolios and staffing. Sector groups have said they intend to review data and engage with the Government on targeted mitigations, and the BHA has announced it will open formal talks to explore joint responses.