UK Budget Lifts Machine Games Duty To 25%, Not The Feared 40%
Chancellor John Healey raised Machine Games Duty (MGD) from 20% to 25% in his Autumn Budget on October 28, 2026, sparing UK casino and betting operators the far steeper rise that had been feared in the run-up to the statement.
The higher rate applies to Category B machines in casinos, betting shops and bingo venues and takes effect on April 1, 2027, according to iNTERGAME Online. The Office for Budget Responsibility estimates the change will add about £100m a year to gaming duty receipts from 2027-28.
Business rates relief for hospitality firms will not be extended to adult gaming centres, the same report says.
What The Market Made Of It
Listed operators rallied once the announcement landed. At 1:55pm UK time, Entain was up 5.4%, Rank Group 8.1% and evoke 3.8%, Sharecast reported. The move reflected relief that the increase stopped at five percentage points rather than the 40% rate that had been discussed.
Remote gaming duty is a separate tax. It rose from 21% to 40% in April 2026, according to GOV.UK betting and gaming statistics, so online operators were not directly affected by this week's change.
Entain Puts A Number On It
Entain said the higher MGD will add £25m of annualised costs to its UK and Ireland retail business, which covers the Ladbrokes and Coral shop estate, before any mitigation. In its statement on the Budget, the group said it was disappointed by the decision to increase the tax burden on an already highly taxed industry.
The operator expects to offset the full amount by the end of 2028 through estate rationalisation, group-wide optimisation and potential market share gains. Its FY26 guidance and its expectation of £500m in annual adjusted cashflow in 2028 are unchanged. Entain also pointed to a chance to win back customers as competitors reassess their UK market presence.
Flutter, owner of Paddy Power, declined to comment, citing recent UK and Ireland redundancies and its third-quarter results due on November 4, iNTERGAME Online reported.
Industry Warns Of Closures And Job Losses
Betting and Gaming Council chief executive Grainne Hurst called the decision deeply damaging for workers, businesses and communities. The BGC cited EY modelling suggesting almost 9,000 jobs could be lost and that almost 1,000 betting shops and casinos could close or be at serious risk of closure.
The council said more than 600 betting shops have closed or announced closure since last year's Budget, and that over 11,000 jobs across the online and retail sectors have been lost or put at risk. It warned that casino closures would be concentrated in the north of England and Scotland.
The BGC also pointed to the sector's contribution to sport, including around £350m a year to horse racing and more than £40m to the English Football League and Scottish football.
Casino Games Hub
Racing And Retail React
Mark Renshaw, chief executive of Racing Post owner Spotlight Sports Group, said a five-point rise on the standard rate is a 25% increase in the tax itself. He said Arena Racing Company estimates the 600-plus shop closures since the last Budget have cost horse racing £17m in levy and media rights. Renshaw noted there are still more than 5,600 betting shops in Great Britain, according to the Gambling Commission.
Retail pressure was already visible before the Budget. William Hill owner evoke said in its Q3 trading update on October 23 that 270 of its shops had closed over the past year, and it urged the government to weigh any further increases carefully.
The Rank Group and Genting Casinos UK had both warned ahead of the Budget about the impact of an MGD rise, and The Bingo Association also spoke out against one. For readers following the sector, our UK news hub will track how operators respond ahead of the April 2027 start date.
