UK Budget Raises Machine Games Duty to 25% for Category B Machines from 2027

The UK Budget lowered the threshold for the top duty rate. From 1 April 2027, any Category B machine that offers a maximum charge above £1 or a maximum prize above £100 will fall under the 25% duty bracket. Bingo halls, betting shops and casinos will now pay the higher rate on these machines, while pubs and seaside arcades stay in the lower bracket.

Operators that run Category B machines—primarily bingo halls, betting shops and casinos—will see the duty increase. The change does not affect machines in pubs or seaside arcades, which remain under the 20% standard rate.

The Finance Bill 2026-27 projects an additional £135 million in the 2027/28 tax year, rising to £150 million in 2028/29. The higher rate, combined with the shift to supplier liability, is expected to generate the bulk of this increase.

Under current HMRC guidance, suppliers are not liable for duty even when they share in takings. From 1 April 2028, suppliers will pay duty on machines they own that run under profit-share deals. Premises operators remain liable where they own a machine outright or control takings under fixed-term leases.

Entain projects the duty rise will add about £25 million a year to its UK and Ireland retail costs before mitigation. The group plans to cover the full cost by the end of 2028 through estate rationalisation, group-wide savings and potential market share gains. Its FY26 guidance and 2028 cash-flow target remain unchanged.

Entain shares rose 4.68 % to 473.90p, Rank Group climbed 8.75 % to 85.80p, and evoke gained 3.77 % to 44.62p following the announcement. The Betting and Gaming Council, however, called the rise a “deeply damaging decision” and warned it could cost nearly 9,000 jobs and threaten the viability of around 1,000 betting shops and casinos.

Regulus Partners estimates the higher rate could close half of Britain’s betting shops over four years and cost racing £57 million in levy and media rights income.

Adult gaming centres lose business rates relief, and the second consecutive Budget has raised gambling taxes. In November 2025, remote gaming duty rose from 21 % to 40 % from April 2026.

HMRC is consulting on supplier liability, with the consultation closing at 11:59 pm on 20 January 2027. The consultation does not seek views on duty rates or stake and prize limits.

For a deeper dive into the draft and the debate it sparked, see the Machine Games Duty Draft Sparks Tax Debate Ahead of Budget.