Betting shops face 25% machine tax as Healey spares pubs & arcades

Pubs & seaside arcades keep a lower 15% rate while business rate relief is carved away from adult gaming centres.

The hit

UK Chancellor John Healey has confirmed Machine Games Duty on Category B slot machines will rise from 20% to 25% in the 2026 budget, according to SBC News. The rise funds business rate relief for high street retail, hospitality & leisure firms. Pubs & seaside arcades keep the lower 15% rate on their low-stakes machines.

Why it matters

The hike lands directly on betting shops & adult gaming centres (AGCs) running Category B machines, the standard slot machine type found across betting shops, amusement arcades & AGCs in the UK, according to SBC News. It adds pressure to omnichannel operators such as Paddy Power, Betfred & William Hill, already mitigating rises in Remote Gaming Duty & General Betting Duty. Concerns that operators may cut headcount to cover rising costs remain widespread, & Caroline Butler, director of recruitment advisory firm TalentThrive, said a further significant tax increase would “accelerate those conversations” among operators with substantial retail exposure.

The record

Machine Games Duty rise	Category B machines (Healey, UK budget)
Remote Gaming Duty rise	21% to 40% from April 2026 (SBC News)
General Betting Duty rise	15% to 25% from next April, retail betting excluded (SBC News)
Small business rate relief threshold	£12,000 to £18,000, 70,000 businesses excluded (Healey)
National Living Wage rise	£12.71 to £13.20 an hour, up 3.9% (Healey)

What happens next

Watch whether betting shops will also benefit from the business rate relief cut, which Healey has not yet clarified, & how operators respond before the General Betting Duty rise next April.

Sources: John Healey’s UK budget hikes gambling machine tax to 25%

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