The proposal could raise the tax burden on some betting shop, adult gaming centre and bingo machines. It is not law, and the Treasury has announced no final decision.

Ninety Labour MPs have urged Chancellor John Healey to raise Machine Games Duty on Category B machines to 40% before the United Kingdom Budget on 28 October 2026.

Alex Ballinger, a Labour MP, organised the letter reported by SBC News on 16 October. It calls for a targeted increase on machines used in betting shops, adult gaming centres and bingo venues.

The letter also seeks protection for pub machines and bingo’s core activity. That means the proposed rate would not automatically apply to every machine or every gambling venue.

What would change?

Machine Games Duty is charged on a machine’s net takings. That means money played minus winnings.

HM Revenue and Customs currently lists three rates, depending on the machine’s play and prize limits:

  • 5%
  • 20%
  • 25%

The standard rate applies to machines with a cost to play of between 21 pence and £5, according to HM Revenue and Customs.

The parliamentary letter focuses on Category B machines, particularly B3 machines. Under Gambling Commission rules, B3 machines can allow stakes of up to £2 and prizes of up to £500.

They are commonly found in betting shops, adult gaming centres and bingo premises. A 40% rate would therefore be a major increase for the machines covered by the proposal.

Industry warns of closures

The Betting and Gaming Council has urged Mr Healey to reject further gambling duty increases.

Its members say a 40% Machine Games Duty rate could put the following at risk, according to EY modelling commissioned by the council and reported by Sky News:

  • Between 690 and 1,470 betting shops
  • Up to 34 casinos
  • Between 11,600 and 15,900 jobs

Those figures are an industry-backed estimate, not an independent government forecast. The council also says the impact would fall heavily outside London.

In a statement dated 13 October, the council said more than 80% of betting shop jobs are based outside the capital. It highlighted market towns, former industrial communities and seaside towns.

The council argues that closures could leave the Treasury up to £124 million worse off after lost tax receipts from affected businesses and workers.

A direct clash over policy

Labour MPs frame the proposal as a community measure. Their argument is that higher duty should target higher-stake machines linked to gambling harm, while pubs and bingo retain protections.

The industry presents the same policy as a threat to regulated high streets. That argument comes after the 40% Remote Gaming Duty rate took effect for online gaming on 1 April 2026.

The government has also set out a new 25% remote betting rate from 1 April 2027. The different rates show that the debate is not about one tax alone. It is about how the government divides the burden between machines, online gaming and betting.

Ministers must weigh possible extra revenue and harm reduction against the risk of closing licensed venues that provide jobs, local services and regulated gambling controls.

What happens next?

The Budget is scheduled for Wednesday, 28 October 2026. Until the Chancellor announces a measure and Parliament legislates where required, the 40% proposal remains a parliamentary demand rather than an effective tax rate.

Operators cannot yet treat the proposal as a confirmed liability. They must still prepare for a policy that could change the economics of machine-heavy venues across Great Britain.