UK Budget extends higher Machine Games Duty rate to Category B machines from 2027

The UK government has announced that Category B gaming machines located in bingo halls, betting shops, and casinos will be subject to the higher 25% rate of Machine Games Duty (MGD) starting in April 2027. The change follows a reduction in the threshold for the top rate of MGD as part of the latest Budget.

Category B machines include B1, B2, B3, and B4 terminals, which typically offer higher stakes and prizes than lower-category slots. Previously, many of these machines fell under a lower duty band; the adjusted threshold now pulls them into the top rate, increasing the tax burden on operators.

In a separate but related move, the government has launched a consultation on shifting the liability for MGD from machine operators to suppliers. If implemented, this change would take effect from April 2028, potentially altering how tax is collected across the industry.

The Budget document confirms that the consultation period is now open, allowing stakeholders to provide feedback on the proposed shift. Industry observers expect the consultation to address concerns around compliance costs and the practical implications of moving tax responsibility up the supply chain.

These measures are part of broader efforts to modernise gaming taxation in the UK, following the Gambling Act review white paper published earlier this year. The government has indicated that the changes aim to ensure fair tax contributions from all sectors of the gambling industry.