UK government raises Machine Games Duty to 25% from April 2027

The UK government will raise Machine Games Duty (MGD) from 20% to 25% for gaming machines with stakes over £1 or prizes over £100, starting 1 April 2027. Chancellor John Healey confirmed the change in his first Budget, according to the government.

The government said the higher rate applies to machines that are riskier in terms of gambling harm and are usually found in venues such as adult gaming centres. Revenue from the measure is intended to fund a business rates freeze for retail, hospitality and leisure properties, with the aim that none of those properties sees a real-terms increase, according to the government. The existing rate for lower-stake machines stays in place, which the government said is meant to protect pubs and seaside arcades.

Liability for MGD on supplier-owned machines under profit-sharing arrangements will move to machine suppliers from 1 April 2028. The government has opened a 12-week consultation on implementing the reform, which closes on 20 January 2027.

The MGD increase and the shift in duty liability are expected to generate additional taxes of £135m in 2027/28, rising to £150m in 2028/29.

The Betting and Gaming Council (BGC) said it was deeply disappointed and concerned by the decision. BGC chief executive Grainne Hurst said the rise would damage workers, businesses and communities that depend on the regulated betting and gaming industry, and that the Chancellor had ignored repeated warnings about the consequences.

According to Hurst, EY modelling shows that at a 25 per cent rate nearly 9,000 jobs are at risk and nearly 1,000 betting shops and casinos might shut or face serious danger. She described casinos as significant employers that play an important part in local economies, warning that the move would push businesses that could otherwise survive into closure and hold back investment.

Hurst said the industry contributes £6.8bn to the British economy, generates more than £4bn in tax and supports 109,000 jobs, and that the government had chosen a course that would destroy jobs, close businesses and reduce the industry's economic contribution. She said the tax rise would cost British jobs, close businesses and hollow out high streets while giving an advantage to illegal operators.

Online gaming duty in the UK was raised to 40 per cent in last year's Budget, taking effect in April 2026, and general betting duty is set to reach 25 per cent in April 2027. The BGC reports that over 600 betting shops have since closed or announced closure, with more than 11,000 jobs in the online and retail sectors lost or put at risk.

The BGC warned that the tax increase would add to the strain on the industry's backing for British sport. That backing includes roughly £350 million a year for horseracing and over £40 million for the English Football League and Scottish football, as well as support for rugby league, darts and snooker.