The Chancellor announced in the Budget on 28 October 2026 that Machine Games Duty will increase from 20% to 25% for higher-stakes machines, and the Government’s “Hope on the High Street” strategy sets out further detail on proposals to remove “aim to permit” and introduce Gambling Impact Assessments.
Machine Games Duty
In his Budget statement on 28 October 2026, the Chancellor, John Healey, announced an increase in Machine Games Duty (MGD) from 20% to 25% for higher-stakes machines, while stating that pubs and seaside arcades would be protected. The Chancellor said the increase would help pay for support for high streets.
The change is due to take effect from 1 April 2027.
The three-rate structure of MGD remains in place; the change affects the point at which the higher rate applies. At present, the 25% rate applies to machines where the maximum charge to play exceeds £5.
From April 2027, machines with a maximum charge above £1, or a maximum prize above £100, will be subject to the 25% rate, essentially the new rate will apply all category B gaming machines.
The Government has said the higher rate will apply to machines commonly found in venues such as adult gaming centres (AGCs), and the lower rate for lower-stakes machines will remain unchanged.
The Budget also announced a consultation on a change to liability for MGD on machines owned by suppliers, who are not currently liable for the duty even where they share in machine takings. The consultation was published yesterday and responses must be submitted by the 20th January 2027. Full details of the consultation can be seen here – Government consultations – machine-games-duty-changing-who-is-liable-for-the-duty
Business rates relief
The Chancellor announced an increase in the threshold for small business rates relief for retail, hospitality and leisure businesses. AGCs will not be entitled to this relief.
Removal of “aim to permit”
The Government’s high streets strategy, “Hope on the High Street”, was published following the Budget and sets out in more detail the proposals first announced by the Prime Minister on 11 August 2026.
Crucially for the industry, the strategy states that, subject to consultation, the Government will remove the “aim to permit” principle.
The strategy describes the principle as having constrained councils’ ability to refuse new gambling premises, and states that the intention of the change is to give greater weight to local concerns in decision-making.
Section 153 of the Gambling Act 2005 currently requires licensing authorities to aim to permit the use of premises for gambling, insofar as they think it is reasonably consistent with the licensing objectives and the other matters set out in that section.
The strategy’s annex summarises the proposal as implementing Gambling Impact Assessments and revoking the rule that councils should “aim to permit” gambling licences, subject to consultation.
Gambling Impact Assessments
The strategy goes on to announce that Gambling Impact Assessments will come into force in November this year. According to the strategy, they will allow licensing authorities to consider local evidence when assessing the risks associated with new gambling businesses, including:
- crime;
- deprivation;
- anti-social behaviour;
- public health data; and
- the concentration of existing premises.
The strategy also states that licensing authorities will be able to designate areas in which the “aim to permit” principle no longer applies.
A full link to the Hope on the High Street document published by the Government can be seen here – Hope on the High Street
For further information, please feel free to contact any of our licensing solicitors at Poppleston Allen on 0115 953 8500.
