Bacta mounts evidence-based defense against Category B MGD rise ahead of Autumn Budget

Bacta, the UK trade body for gaming and amusement halls, is preparing an evidence-based submission for the Autumn Budget, combining internal insight, external expertise and member testimony to argue against tax increases on land-based gaming. Submissions close on September 9, seven weeks before Chancellor John Healey presents the Budget to the House of Commons on October 28 — the first Budget under Prime Minister Andy Burnham, who appointed Healey on July 20.

Budget context

The land-based sector escaped tax changes in the previous Autumn Budget, which raised Remote Gaming Duty from 21 to 40 per cent from April 2026 and lifted general betting duty on online sports wagers, excluding horseracing, from 15 to 25 per cent from April 2027; bingo duty was scrapped entirely. The Social Market Foundation has since proposed raising Machine Games Duty (MGD) on Category B machines to 40 per cent, matching the new online slots rate. Category B devices, the most common electronic gaming machines in UK betting shops, arcades and bingo halls with a top payout of £500, are currently taxed at 5 per cent on stakes up to 20p, 20 per cent on stakes up to £5 and 25 per cent on stakes above £5.

The SMF argues the change would shift the tax burden to riskier machines while protecting hospitality, leaving Category C machines in pubs at 20 per cent and lower-stake devices at 5 per cent. However, a Bacta member survey found 90 per cent fear severe negative impact from such a move. Separate government plans would reduce business rate relief from April 2027 for high street venues deemed to have a negative impact on society; vape shops were named immediately, but gaming venues were strongly hinted at.

The sector’s case

Bacta President Joseph Cullis said the body would repeat the “evidence-based strategy” it used last year, despite what he called an extremely small window to make its case. He described the impact of a significant MGD uplift as “frightening and stark” and warned that the damage would not stop at land-based gambling, but would be felt on high streets, in seaside towns, in social clubs, on piers, in family entertainment centres, across bingo premises and throughout the supply chain of manufacturers, suppliers and small businesses. Cullis said Bacta would present the strongest possible case for a progressive rather than punitive fiscal regime.

Cullis said the submission would also draw on members’ lived experience. He cited Charles Holland, whose family has operated at the coast for more than half a century, arguing that MGD is a turnover tax and that an increase would leave businesses with three options: absorbing costs through reduced profitability, raising the price of non-gaming equipment, or reducing staffing levels. Cullis concluded that a substantial rise in turnover tax would curb investment, make expansion less attractive, pressure jobs and reduce economic activity at a time when the country seeks growth.

Industry reaction

An accompanying analysis from SCCG Management argued that operators should assemble site-specific impact data immediately, since the Budget will test whether fiscal policy recognises land-based gaming’s economic role or defaults to parity with higher online rates. The commentary, citing three decades of advising operators, investors and regulators, added that submissions combining data with real operator experience tend to be more persuasive than broad assertions. The outcome, it warned, will determine whether land-based venues are treated as growth contributors or pushed toward closures and migration of play to unregulated channels.