Entain warns gaming machine tax rise could add £100m to annual costs

Entain has warned that doubling Machine Games Duty could add £100 million to its annual retail costs and lead to widespread betting shop closures.

The gambling group raised its concerns in a letter to Prime Minister Andy Burnham. This comes ahead of the government’s Autumn Budget in October.

Entain chief executive Stella David said increasing Machine Games Duty (MGD) from 20% to 40% could threaten thousands of jobs. It could also weaken Britain’s high streets and ultimately reduce rather than increase tax receipts.

Entain forecasts betting shop closures

Figures commissioned by the Betting and Gaming Council from consultancy EY suggest the proposed increase could contribute to the closure of as many as 1,470 betting shops. This would mean the loss of up to 15,900 jobs across the industry.

David said Entain’s retail division alone would face approximately £100 million in additional annual costs.

“These are people losing their jobs and communities losing long-established high-street businesses. These jobs matter. They matter particularly in communities where good local employment can be difficult to find.” – Stella David

Half of  Entain’s retail employees are women, while more than 50% work flexible or part-time hours. The company also employs over 2,500 people aged under 25.

The warning follows the government’s decision to remove the “aim to permit” principle for betting shops and require adult gaming centres to obtain planning permission.

MGD applies to profits generated by gaming machines, which Entain said provide an important source of income for betting shops outside major racing and sporting events.

Black market warning

Entain also claimed that increasing MGD could push up to £1 billion in gambling stakes towards unlicensed operators.

The company pointed to Office for Budget Responsibility analysis showing that previous gambling tax increases reduced projected government receipts. Forecast gambling tax revenue for 2029-30 was reportedly revised down by £500 million.

David argued that betting shops support local economies and contribute approximately £50 million each year to British horse racing.

The warning follows research commissioned by Euromat which estimated that Europe’s illegal online gambling market has grown at a compound annual rate of 18% since 2019. The study predicted the market could be worth as much as €13 billion by the end of 2026.

Entain has requested meetings with ministers and invited government officials to speak directly to frontline betting shop employees before making a final decision.

Around 400 customer care jobs at risk

Separately, Entain has opened a consultation that could result in approximately 400 customer care roles being removed from its 2,000-strong UK team.

The company said the restructuring was intended to streamline its operations and establish customer service centres of excellence across different locations.

“The proposed changes are being made to ensure our business remains competitive, financially resilient and well positioned for the future as our sector faces an increasingly challenging operating environment,” David said.

Entain previously announced plans to cut approximately 500 roles globally as part of a broader cost-saving programme. It maintained that those reductions were not prompted by the government’s increase in Remote Gaming Duty to 40%.

The group also closed 39 Ladbrokes shops in Ireland earlier this year, reducing its retail estate in the country by more than one-third.