Entain estimates £25m annual UK retail gaming tax costs from 2027
Regulation2 min read
In brief
- Entain estimates about £25m in additional annual costs from UK gambling tax changes, before mitigation.
- Machine Games Duty on £1-stake machines is to rise from 20% to 25% from 1 April 2027.
- Entain keeps its 2026 guidance unchanged and targets £500m of adjusted annual cash flow in 2028.
- Chief executive Stella David criticised the decision and warned of harm and growth in the illegal market.
Entain has estimated an additional annual cost of about £25m from changes to UK gambling taxation, the company said in a notice published through the London Stock Exchange's RNS service. The estimate covers the group's UK&I Retail division, which includes its shop operations in the UK and Ireland, and was made before any mitigation measures. Entain said its guidance for 2026, issued on 15 October, is unchanged.
According to the company, the change concerns Machine Games Duty on machines in betting shops: for those with a stake of £1, the rate will rise from 20% to 25% from 1 April 2027. The estimate is annualised and is based on consensus expectations for UK&I Retail net gaming revenue in the 2027 financial year.
To absorb the added cost, Entain plans a combination of rationalising its shop network, group-level optimisation initiatives and possible market-share gains. The company said it believes it can recover customers while other operators reassess their presence in the British market. It also restated its target of generating £500m of adjusted annual cash flow in 2028, an indicator calculated before changes in working capital, shareholder dividends, acquisitions and related financing.
Chief executive Stella David said the government's decision was disappointing and that previous tax increases on gambling, announced in November last year, had already had negative consequences across the sector, felt by employees, communities and customers. She said the further tax changes would worsen that damage and push more people towards the illegal market, which she described as expanding. David said the company would keep working to limit the impact on its business, its people and the communities where it operates, with priority on protecting jobs wherever possible while supporting a sustainable shop presence on British high streets.