Entain and Rank Group Issue Warnings on Potential Machine Games Duty Increases Ahead of Budget

Two of Britain’s largest gambling operators have written to Chancellor John Healey to highlight risks associated with further tax increases in the upcoming Budget, with particular focus on a possible rise in Machine Games Duty to 40 percent. Entain, which owns Ladbrokes and Coral, along with Rank Group, operator of Grosvenor Casinos and Mecca Bingo, stated that such changes could lead to closures of betting shops and casinos while putting thousands of jobs at risk and reducing future investment.

The warnings arrive even as both companies have reported growth in their UK operations, including an 8 percent rise in Entain’s UK and Ireland net gaming revenue during the third quarter driven primarily by online activity. Observers note that these letters reference the effects already seen after the Remote Gaming Duty increase to 40 percent took effect in April 2026, which contributed to hundreds of shop closures and associated job losses across the sector.

Details of the Industry Letters to the Chancellor

Entain and Rank Group sent formal communications outlining how an increase in Machine Games Duty would affect their land-based businesses, which rely heavily on gaming machines in betting shops and casinos. The companies explained that higher duty rates would compress margins at a time when operating costs continue to rise, potentially forcing decisions on site viability that could result in reduced numbers of high street locations. Data from the firms indicates that many venues already operate on narrow profitability thresholds, so additional tax pressure would accelerate consolidation or outright closures in certain regions.

Rank Group specifically highlighted the situation at its Grosvenor Casinos and Mecca Bingo halls, where machine revenue forms a significant portion of overall takings. The operator noted that previous duty adjustments had already prompted efficiency measures, yet further hikes would limit the scope for maintaining current staffing levels and reinvestment in premises. Entain echoed these points while adding that its broader portfolio, which includes both retail and digital channels, would face uneven impacts if land-based taxation rises without corresponding adjustments elsewhere.

Context of Recent Business Performance

Despite the warnings, company reports show continued expansion in certain segments. Entain recorded the 8 percent increase in UK and Ireland net gaming revenue for the third quarter, with online platforms accounting for the majority of that growth. Rank Group has similarly maintained steady participation at its venues even as overall market conditions remain competitive. These figures suggest that digital channels have absorbed some of the momentum previously concentrated in physical sites, a shift that accelerated following the April 2026 Remote Gaming Duty change.

Industry analysts tracking these trends point out that online revenue now represents a larger share of total UK gambling activity for both operators. This transition has allowed headline numbers to remain positive while physical locations absorb more of the cost pressures. The letters to the Chancellor emphasize that land-based operations still support substantial employment and supply chain activity, which would diminish if Machine Games Duty adjustments proceed as feared.

Reference to Earlier Duty Changes and Their Effects

The operators drew direct comparisons to the Remote Gaming Duty rise implemented in April 2026, which moved the rate to 40 percent for online activities. That adjustment preceded a wave of betting shop closures and workforce reductions as operators recalibrated their retail footprints. Hundreds of locations closed in the months that followed, with job losses concentrated in regions where multiple sites operated in close proximity. The current warnings suggest that a parallel increase in Machine Games Duty could produce comparable outcomes for casino and bingo operations.

Company statements indicate that the combined effect of successive tax increases would compound existing challenges around cost management and customer retention. While online growth has offset some retail declines, the letters argue that physical venues continue to serve distinct customer segments that value in-person experiences. Reductions in those venues would therefore remove options for those customers without necessarily migrating all activity to digital platforms.

Broader Sector Implications

Other gambling businesses have monitored the correspondence between Entain, Rank Group and the Treasury, recognizing that any Machine Games Duty change would set precedents for the wider market. Trade associations have compiled supporting data on employment and investment patterns, showing how land-based gambling contributes to local economies through direct jobs, supplier contracts and property occupancy. The operators’ warnings align with these datasets in stressing that tax policy decisions carry consequences beyond immediate revenue collection.

Figures released earlier in 2026 already documented the post-April adjustments, including reduced capital expenditure on venue upgrades and slower hiring in certain regions. The upcoming Budget therefore represents a further point of uncertainty for operators planning their operational footprints through the remainder of the year and into 2027.

Conclusion

The letters from Entain and Rank Group set out specific concerns about how a Machine Games Duty increase to 40 percent would interact with current business conditions and prior tax changes. They reference documented shop closures and job reductions that followed the April 2026 Remote Gaming Duty adjustment, while noting ongoing growth in online segments. The correspondence provides the Chancellor with operator-level data on potential retail impacts ahead of final Budget decisions.