Hundreds of England Slot Arcades May Keep Business Rates Discount
Of adult gaming centres in England hold bingo licences that may let them keep a business-rates discount despite a new tax change. The government raised duty on…
Hundreds of high street slot farms in England may retain discounted business rates through bingo licences, despite the government’s new tax changes for adult gaming centres. The government raised duty on slot machine takings from 20% to 25% and said adult gaming centres would no longer qualify for a business-rates discount aimed at leisure and hospitality businesses.
The licensing loophole could blunt that part of the policy. Gambling Commission records indicate that more than 200 arcades are licensed as bingo venues, even though they appear geared mainly towards slot machine play; duplicated records make the exact number difficult to establish.
How could bingo licences affect the tax change?
Some operators hold bingo licences for venues that appear to offer slot machines almost exclusively. Those licences may allow the businesses to argue that their premises qualify for different business-rates treatment.
John Healey singled out adult gaming centres in his first budget this week. He said the government was raising gambling taxes “to support good growth on every high street”. The increase in machine duty also affects bookmakers and casinos, while the business-rates change applies to adult gaming centres and vape shops in England.
Guardian analysis found that shops belonging to Merkur and Admiral, described as the UK’s two largest slot farm companies, could escape the business-rates change. At venues visited, bingo was advertised in the windows, but machines appeared to dominate the premises. Bingo was available on tablets in a small corner.
In one venue, a staff member said nobody used the bingo tablets, which appeared not to be working. The rest of the room was dedicated to slot machines offering a £2 spin every 2.5 seconds for a £500 jackpot.
What is at stake for high street slot farms?
The distinction matters because the tax rise and the discount removal work differently. The higher duty increases tax on machine takings, while business rates affect the cost of occupying a venue. If a licence changes how a site is treated, some operators may not face the intended business-rates change, leaving a gap between the government’s stated policy and its application on high streets.
The policy also has a consumer-protection dimension. The source describes category B3 machines as associated with higher levels of gambling-related harm than most other products, citing several studies. One example was a Merkur Slots shop in Stockport, where Wendy Hughes, who had terminal cancer, lost £2,000 over two spells lasting 16 hours. Merkur was fined £100,000 after the case was revealed. Hughes has since died.
Labour MP Alex Ballinger, co-chair of the gambling reform all-party parliamentary group, welcomed the duty increase but called for action on the licensing issue. “We must ensure these licences cannot be used to sidestep the new business rates rules,” he said.
Ballinger urged the Department for Culture, Media and Sport to advance proposals to tighten licensing rules while a consultation is under way. He said ministers had recognised the problem and expressed confidence they would work with the regulator on closing loopholes and enforcement.
Paul Turner-Mitchell, a business-rates expert at Altus Group, said the outcome could depend on how the Treasury defines an adult gaming centre and how local councils enforce the rules. “A bingo licence alone does not settle its business rates treatment,” he said.
Merkur and Admiral did not respond to a request for comment. Joseph Cullis, president of arcade operators’ trade body Bacta, said the sector would be hit hard by the tax changes. The slot machine duty rises from 20% to 25%.
