The Social Market Foundation’s proposal to double Machine Games Duty on Category B machines is not a serious plan for raising revenue. It is a plan for closing venues.
A 40 percent tax rate would be a direct hit on Britain’s land-based gambling sector, but the damage would not stop there.
It 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, machine suppliers and small businesses that depend on this sector.
This proposal fundamentally misunderstands how land-based venues operate. Our members cannot simply pass on extra costs to customers. Stakes and prizes are fixed in law.
At the same time, operators are already absorbing higher wages, energy costs, business rates, irrecoverable VAT and the new statutory levy.
To suggest that the sector can simply take another major tax increase is fantasy economics.
The SMF appears to have tried to separate Category B and Category C machines in order to avoid opposition from pubs and hospitality. That may be politically convenient, but it is economically incoherent. You cannot carve up the land-based sector on a spreadsheet and pretend there will be no wider consequences.
Many Adult Gaming Centres and bingo premises and social clubs operate on tight margins. Many are family businesses. Many are rooted in their communities. They employ local people, pay local taxes, occupy high street units and support surrounding businesses by generating footfall.
In coastal towns, the position is even more serious. Adult-only gaming areas often help keep piers and Family Entertainment Centres viable beyond the summer season. That income supports year-round jobs, funds investment in family attractions and helps keep the lights on when tourism slows. Take it away, and the impact will be felt far beyond the gaming floor.
Bacta’s own modelling already shows that even a much smaller rise in Machine Games Duty would reduce overall tax receipts. A 40 percent rate would push the sector far beyond the point where higher taxes raise more money. Venues would close, jobs would be lost, investment would stop and Treasury receipts would nosedive.
It would also risk pushing customers away from safe, supervised and regulated venues. Bacta members operate under strict Gambling Commission rules, with trained staff, age verification, customer interaction, self-exclusion and safer gambling safeguards. Weakening regulated venues does nothing to protect consumers – it simply damages the businesses that are already doing things properly.
We would welcome the opportunity to take the SMF outside London and show them what this sector actually looks like. They should visit the high streets where our members have taken on empty units. They should visit the seaside towns where arcades and adult-only gaming areas help sustain the wider tourist offer. They should meet the families who have built these businesses over generations and the staff whose jobs would be put at risk.
Treasury should be clear-eyed about this. If the objective is to raise more revenue, this proposal will fail. If the objective is to support high streets, seaside towns and responsible land-based entertainment, it will do the opposite.
Bacta will be working on a detailed rebuttal and will make the case directly to Government. Our message is simple: any increase in Machine Games Duty would close venues, cost jobs, damage seaside towns and reduce, not increase, tax receipts.
The social impact of SMF proposals
Joseph Cullis said……. Many Adult Gaming Centres and bingo premises and social clubs operate on tight margins. Many are family businesses. Many are rooted in their communities. They employ local people, pay local taxes, occupy high street units and support surrounding businesses by generating footfall…
Originally published on Coinslot on July 6, 2026. Republished with permission.