UK Budget Raises Machine Games Duty to 25% From April 2027

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Altay Celikkaya

Content Manager

Updated: 29/10/26

Reading Time: 3 minutes

The UK government has announced plans to increase Machine Games Duty (MGD) from 20% to 25% for higher-stakes gaming machines from 1 April 2027. The measure, unveiled in Chancellor John Healey’s 28 October Budget, has prompted warnings from operators and industry representatives about additional costs, jobs and the future of retail gambling venues.

Entain estimates an additional £25 million in annual costs for its UK and Ireland retail business before mitigation. The Betting and Gaming Council (BGC) has warned of potential job losses and venue closures, citing EY projections.

Big Ben, the Union Jack and a red Budget box illustrate the UK’s Machine Games Duty increase.

Industry News

Key Takeaways From the UK Gambling Tax Announcement

MGD will rise from 20% to 25% for affected machines from 1 April 2027, with legislation planned through Finance Bill 2026–27.
Entain’s £25 million estimate is an annualised cost before mitigation. The group expects to offset the impact fully by the end of 2028.
The BGC’s employment and venue figures are projections, covering potential job losses and premises that could close or face serious risk of closure.

Higher Machine Games Duty Will Apply From April 2027

The government’s tax legislation overview says machines with a maximum charge to play of more than £1, or a maximum prize of more than £100, will become subject to the 25% rate instead of 20%.

The announcement follows calls from 90 Labour MPs for higher gaming machine taxes. Their October letter referenced modelling based on a 40% rate, although it did not formally request that specific rate. The Budget has now set out the government’s intended increase.

In its Budget document, the Treasury says the additional MGD revenue will help fund a real-terms freeze in business rates for retail, hospitality and leisure properties.

Entain Puts Annual Retail Cost at £25 Million

Ladbrokes and Coral owner Entain said in its Budget response that the change would add approximately £25 million in annualised costs to its UK and Ireland retail division before mitigating measures.

The group expects to offset the full impact by the end of 2028 through changes to its shop estate, efficiencies across the business and potential market share gains as competitors reassess their UK presence.

Entain kept its 2026 guidance unchanged, alongside its expectation of generating £500 million in annual adjusted cash flow in 2028.

Chief executive Stella David said:

Our priority is to protect jobs wherever possible whilst supporting a sustainable retail presence on UK high streets.

BGC Warns of Risks to Jobs and Retail Venues

In its 28 October response, the BGC said EY projects that almost 9,000 people could lose their jobs at the 25% MGD rate. Almost 1,000 betting shops and casinos could close or face serious risk of closure.

These figures describe projected risks following the tax increase. The BGC also warned that the measure could undermine planned casino investment and put further pressure on the sector’s financial support for British sport.

The response follows the BGC’s Back Our Betting Shops campaign, launched in September to highlight retail employment and the potential consequences of further tax increases.

Retail Operators Face Further Machine Changes in 2027

The April tax increase comes ahead of separate new Category B gaming machine requirements, with most technical and player-protection changes taking effect on 30 June 2027.

Those rules address areas including session information and game design. For operators and machine suppliers, the two timetables bring tax planning and product compliance decisions into the same quarter.