90 Labour MPs Sign Letter Calling for Machine Games Duty Hike

The Autumn Budget announcement is approaching on the horizon.

Next Wednesday (October 28), the gambling industry will find out if the chancellor, John Healey, plans to increase Machine Games Duty (MGD) in his first budget reveal.

Based on the reports that have been shared by various sources, it’s more a case of how much by – not if – MGD will be hiked.

And that has perhaps become even more likely now that 90 Labour MPs have undersigned a letter penned by the co-chair of the All-Party Parliamentary Group, Alex Ballinger. They want MGD on Category B machines to be doubled to 40%... a potential death knell for betting shops and other gambling venues in the UK.

Category B Machine Hike

Plenty of industry stakeholders have spoken out against any MGD hike, which will likely lead to mass venue closures and unemployment.

But few voices had been heard supporting an MGD increase… until the weekend, when Ballinger – a vocal gambling industry critic – put pen to paper in a bid to persuade Healey on the subject.

He has managed to collect 90 signatures from within the Labour Party, which adds credence to his argument and may well be enough to convince Healey of the merits of a Machine Games Duty grab – despite warnings as to what that will mean for local communities and the economy.

The letter demands a rethink of the duty paid on Category B gaming machines, which are typically found in high street betting shops as well as Adult Gaming Centres, casinos and bingo halls. These machines are split into five sub-categories:

• B1 – Maximum Stake £5, Maximum Prize £20,000
• B2 – Maximum Stake £2, Maximum Prize £500
• B3 – Maximum Stake £2, Maximum Prize £500
• B3a – Maximum Stake £2, Maximum Prize £500
• B4 – Maximum Stake £2, Maximum Prize £400

Betting shops can host B2 and B3 machines, while casinos can have all but B3A – they also have exclusivity over B1. Bingo halls and Adult Gaming Centres are allowed B3 and B4 machines, while B3a games are restricted to designated members’ clubs, where the maximum stake is applied in addition to a maximum ‘charge for use’ of £1.

Adult Gaming Centres Targeted

According to Ballinger, all Category B machines should be subject to the 40% rate of tax. He, and many within Labour’s ranks – including the Prime Minister, want to target Adult Gaming Centres in particular, which Ballinger writes:

‘47% are located in the most deprived fifth of the country, while the most deprived local authorities have more than six times as many per head as the least deprived.’

“In a review of Category B3 machines, the government noted evidence from the Gambling Commission that players of high-stake, high-prize machines are among the groups most likely to contact gambling help services,” Ballinger wrote.

However, it’s also worth noting that the MP for Hounslow has been namechecked three times by the Gambling Commission in their register of incidents in which industry data may have been ‘taken out of context, manipulated, or presented in a way that could materially mislead others.’

Bingo Bombshell

The letter calls for a specific carve-out for fruit machines in pubs, as well as on Category B machines in bingo halls – despite the signatories recognising the ‘important social and community role’ that bingo venues play.

However, numerous stakeholders within the bingo sector – including Rank Group CEO Richard Harris – have warned that a strong of venue closures would be inevitable if MGD is hiked.

Industry data has suggested that as many as 15,900 jobs could be lost if MGD is lifted to 40%, with around 3,000 employees under the age of 25 at risk of redundancy.