Chancellor John Healey is reportedly considering a proposal to increase taxes on high-street slot machines in his first budget. The Social Market Foundation thinktank, a proponent of the tax increase, suggests raising machine games duty (MGD) from 20% to 40%. This measure could potentially raise between £275m and £460m annually, in addition to the approximately £610m collected last year.
The gambling industry has expressed strong concerns regarding the potential tax hike. Fred Done, the owner of Betfred, stated that such a policy would compel shop closures, result in job losses, and ultimately fail to meet its objective, thereby reducing tax revenue for the Treasury. Entain, which owns Ladbrokes and Coral, has also indicated that job cuts would be necessary across its 2,300 shops if the policy proceeds. Rank Group, owner of Mecca Bingo and Grosvenor Casinos, cautioned that a third of its venues could close, affecting 2,000 staff.
However, not all figures within the gambling sector agree with these warnings. Stewart Kenny, co-founder of Paddy Power, has accused Fred Done of “scaremongering.” The Betting and Gaming Council, an industry lobby group, commissioned a report from EY estimating that a duty rise to 40% could lead to the closure of up to 1,470 betting shops and 15,900 job losses, resulting in a net loss of approximately £120m to the exchequer.
Andy Burnham, a critic of slot machines, has already taken steps to tighten licensing laws to make it more difficult for gambling firms to open new shops. He has raised particular concerns about 24-hour adult gaming centres (AGCs), which are high street venues with many machines that would be subject to increased MGD. Treasury officials are currently evaluating the potential duty rises.