Labour MPs Call for Higher Machine Games Duty on Category B Machines Ahead of 2026 Budget

Ninety Labour MPs led by Alex Ballinger MP have sent a letter to Chancellor John Healey urging an increase in Machine Games Duty on Category B machines before the autumn Budget scheduled for 28 October 2026, and the correspondence focuses on higher-stake slots found in betting shops, casinos and adult gaming centres. The MPs argue that these machines generate significant tax revenue while also contributing to measurable social harms, and they cite modelling that projects annual yields between £275 million and £458 million once behavioural responses are taken into account. The letter specifies that any duty increase should apply only to Category B machines while leaving lower-stake pub machines untouched and avoiding further changes to bingo duty. Data from the modelling exercise shows that such targeted adjustments could deliver the higher revenue figures without triggering widespread venue closures, and the MPs reference earlier analysis from the Social Market Foundation report titled “Addressing the harm: The many arguments for raising Machine Games Duty on Category B machines” to support their position.

Details of the Parliamentary Letter

The document, coordinated by Alex Ballinger MP, carries signatures from ninety Labour members and reaches the Treasury in the weeks leading up to the 28 October 2026 fiscal statement. It outlines how Category B machines currently operate under existing duty rates and proposes a graduated rise that accounts for player behaviour shifts. The modelling incorporated into the letter adjusts revenue forecasts downward to reflect reduced play volumes, yet still produces the £275–458 million range cited by the signatories.

Those who drafted the letter note that Category B machines already attract higher maximum stakes than machines in pubs, and they maintain that this distinction justifies separate tax treatment. The correspondence therefore excludes pub-based terminals and bingo halls from the proposed changes, aiming to protect employment in those sectors while focusing the duty adjustment on venues where stakes and associated harms register at higher levels according to available data.

Revenue Modelling and Projected Outcomes

Independent modelling referenced in the letter incorporates elasticity estimates that show how players respond to increased costs of play. After these adjustments the projected annual receipts sit between £275 million and £458 million, and the figures represent net gains once reduced machine usage is factored in. Observers note that the modelling draws on historical duty changes and consumption patterns recorded by the Gambling Commission, providing a basis for the revenue band presented to the Chancellor.

The letter also stresses that any duty rise would be implemented alongside existing player protection measures, and it points to evidence that higher taxation on these specific terminals has previously coincided with modest reductions in play intensity without eliminating the machines altogether. Data indicates that the behavioural response remains within ranges that still allow substantial tax collection, which is why the MPs present the £275–458 million interval as a realistic outcome for the Treasury.

Industry Response from the Betting and Gaming Council

The Betting and Gaming Council has responded to the letter by highlighting risks of venue closures and job losses if duty on Category B machines rises. Council representatives argue that higher operating costs could force some betting shops and adult gaming centres to reduce opening hours or shut locations entirely, and they warn that such outcomes might ultimately lower total tax revenue collected from the sector. The organisation’s statements emphasise that Category B machines support employment in high-street venues across the UK, and they call for the Treasury to consider these employment figures when reviewing the MPs’ proposal ahead of the 28 October 2026 Budget.

Industry figures further contend that any duty increase should be evaluated against broader economic contributions from licensed gambling premises, including business rates and supply-chain spending. The Betting and Gaming Council has not published alternative revenue forecasts in its initial response, yet it maintains that the modelling cited by the MPs underestimates the scale of behavioural change that could follow a duty adjustment.

Context Ahead of the October 2026 Autumn Budget

The letter arrives as the Treasury prepares its fiscal plans for the 28 October 2026 statement, and it forms part of wider discussions about gambling taxation that have continued through the current Parliament. MPs who signed the correspondence frame the proposed duty change as one component of a larger approach to public finances, while the exemptions for pub machines and bingo reflect efforts to limit impact on particular business models. The Chancellor has not yet issued a formal reply, and the Treasury continues to receive submissions from both parliamentary groups and industry bodies as the Budget date approaches.

Conclusion

The letter from the ninety Labour MPs sets out a targeted adjustment to Machine Games Duty on Category B machines, supported by revenue projections of £275–458 million annually and accompanied by specific exemptions for other machine types. The Betting and Gaming Council has outlined concerns about venue viability and employment, leaving the Treasury to weigh these positions before the 28 October 2026 Budget. The correspondence and the subsequent industry response together illustrate the range of data and arguments now under consideration by policymakers.