Budget Announcement Details

The Chancellor John Healey delivered the Budget on October 28, 2026, and included an increase in Machine Games Duty from 20% to 25% on slot machines, with the change set to take effect in April 2027, while the same measures removed business rates discounts previously available to adult gaming centres, which many observers refer to as slot farms, and these adjustments applied directly to venues operating high-stakes Category B3 machines that offer jackpots up to £500.

Policy documents outlined the duty hike as a targeted adjustment aimed at adult gaming centres, yet the removal of business rates relief created immediate questions about how operators might respond, and data from licensing records showed that hundreds of sites already held additional permissions that could alter their tax treatment.

Business Rates Changes and Venue Classifications

Business rates discounts ended for most adult gaming centres under the new framework, which meant operators faced higher property costs starting in the next financial year, while the Gambling Commission maintains records that classify venues according to their primary activities, and those records now reveal discrepancies between stated and actual operations at many locations.

Operators such as Merkur and Admiral own multiple venues that hold bingo licences, and these licences allow the sites to keep discounted business rates even though on-site activity centres around Category B3 slot machines rather than traditional bingo sessions, and this classification difference stems from regulatory definitions that separate bingo halls from pure slot venues.

Guardian Analysis of Licensing Records

Guardian analysis of Gambling Commission records identified over 200 arcades registered as bingo halls, and these registrations permit retention of business rates discounts despite the venues primarily offering high-stakes slot play, while follow-up on-site visits confirmed that bingo activity remained minimal at the majority of inspected locations.

Records show the pattern across multiple operators, and the same data indicates that bingo licences function as a structural classification that separates these sites from standard adult gaming centres subject to the full rates increase, and this distinction arises because bingo permissions carry different rating rules under current legislation.

Figures from the analysis further reveal that the loophole affects a significant portion of high-street slot operations, and those figures tie directly to licence categories rather than observed customer behaviour, whereas the Budget measures did not include provisions to close this classification gap.

Operator Responses and Licence Structures

Merkur and Admiral maintain portfolios that include both standard adult gaming centres and bingo-registered sites, and this dual structure allows them to navigate the business rates change differently across their estates, while the duty increase still applies uniformly to all slot machines regardless of venue classification.

Regulatory records list the bingo permissions as active at these locations, and the permissions remain valid because they meet minimum requirements for bingo activity even when actual play volumes stay low, and this setup creates a consistent exemption pathway that the October 2026 Budget did not address.

Current Context in November 2026

By November 2026 the industry had begun reviewing venue portfolios in light of the April 2027 implementation date, and operators examined how many sites could qualify for continued rates relief through existing bingo licences, while Gambling Commission data continued to serve as the primary reference for classifying each location.

Venues registered under bingo licences therefore face only the Machine Games Duty adjustment rather than the combined impact of duty and rates changes, and this outcome follows directly from the licence categories recorded prior to the Budget announcement.