Politics Home | A tax raid that Britain’s high streets and leisure venues cannot afford

Britain’s land-based betting and gaming venues are already facing rising employment costs, higher business rates, soaring energy bills and the impact of successive regulatory changes. Against that backdrop, the SMF are now urging ministers to pile on another tax increase.

The question ministers should be asking is not simply how much extra tax would or wouldn’t be raised, but what damage it would do to the businesses, jobs and communities expected to pay it.

It is easy for a think tank to recommend higher taxes from behind a desk. It is much harder to explain the boarded-up bingo clubs, shut betting shops, closed casinos and lost jobs that would follow.

On the surface, the SMF recommends increasing Machine Games Duty. In reality, it is asking ministers to make a much bigger choice: are they prepared to accept the closure of valued leisure venues across Britain in pursuit of a policy that is unlikely to deliver what it promises?

The report fails to answer that question.

Businesses cannot simply absorb a tax increase of this scale. The inevitable consequence is fewer venues, fewer jobs and less investment in communities that can least afford to lose them. Since 2019, more than 3,000 betting shops have closed, costing over 16,000 jobs. 22 casinos have shut their doors with the loss of more than 3,000 jobs, while 108 bingo clubs have closed, resulting in the loss of more than 2,000 jobs. How many more betting shops would close? How many bingo clubs? How many casinos? How many livelihoods would disappear? And what would be the impact on working men’s clubs, miners’ welfare institutes and other community associations that rely on regulated gaming machines to help fund the services they provide?

Those are not side issues. They are the central questions.

Indeed, towards the end of the report is an explicit acknowledgement that reducing the supply of gambling is part of its intended effect. That completely undermines its economic argument. You cannot claim a tax rise will generate more revenue while advocating policies that would close the very businesses expected to pay it.

These are not anonymous businesses on a Treasury spreadsheet.

Many of these businesses have been part of their communities for decades. They are run by local managers, employ local people and provide steady jobs in towns where good employers are becoming harder to find. Their customers also support neighbouring cafés, pubs and shops, helping to keep Britain’s struggling high streets alive.

Nor are their customers an afterthought. Betting shops, bingo clubs and casinos are social hubs where adults choose to meet friends, watch sport, enjoy bingo or place a bet responsibly. The suggestion that customers are simply being lured in to lose money is patronising and wrong. The report dismisses those customers entirely, assuming it knows better than the adults who use these venues responsibly every day.

The same applies to working men’s clubs and miners’ welfare clubs, many of which rely on regulated gaming machines to help keep their doors open as employment costs, business rates and energy bills continue to rise. These are exactly the kinds of community institutions politicians say they want to protect.

Those consequences may not be felt in the Westminster bubble, but they will be felt in the North of England, in seaside towns, former mining communities, market towns and city centres where another boarded-up premises would replace another long-established local business.

There is also a snobbery running through this debate that deserves to be challenged. Too often, metropolitan commentators appear comfortable telling working people how they should spend their money while showing little regard for the venues people value, the jobs they support or the communities they serve.

The consequences extend far beyond the high street.

Every betting shop that closes also weakens one of Britain’s most cherished sports. Licensed betting operators contribute hundreds of millions of pounds every year through the Horserace Betting Levy and media rights payments, supporting racecourses and the wider racing industry. Land-based betting shops are a vital part of that funding. Racing is already under financial pressure and cannot afford to lose it. The impact would be felt far beyond the racecourse, affecting stable staff, trainers, breeders, farriers, vets and thousands of small businesses that depend on a thriving racing industry. Decisions taken on betting shop taxation are not confined to one sector; they ripple through communities and rural economies across Britain.

The report also assumes spending will simply move elsewhere and jobs will be replaced. That is an assertion, not evidence. There is no compelling case that communities become more prosperous when regulated venues disappear.

Its economic case is equally weak. The SMF assumes increasing Machine Games Duty will boost Treasury revenues. History suggests otherwise. Following the reduction in machine stakes in 2018 (effect 1^st April 2019), over 2,000 betting shops closed and gambling duty receipts fell and have never recovered to previous levels. Shrinking the regulated market does not maximise tax receipts; it reduces the number of businesses paying tax.

Then there is the illegal gambling market.

Every time the regulated sector is made less competitive, criminal operators stand to benefit. They pay no UK tax, create no British jobs and offer none of the age verification, safer gambling tools or consumer protections required of licensed operators. Weakening legitimate businesses while strengthening the black market is not sound public policy.

Perhaps the most revealing finding in the report is one its authors may not have intended. Their own polling shows most people do not support increasing taxes on gaming machines.

Public policy should not be driven by assumptions or ideology. It should be driven by evidence and an honest assessment of consequences.

Of course gambling harm must be addressed. Our members continue to invest heavily in safer gambling tools, technology and interventions because protecting customers is fundamental to a sustainable regulated industry. But good intentions do not automatically make good policy.

If ministers follow the SMF’s advice, they will not simply increase Machine Games Duty. They will make a conscious decision to place legitimate businesses under even greater pressure, jeopardise thousands of jobs, weaken horseracing and accelerate the decline of community venues that have served Britain for generations.

That is not evidence-led policymaking.

It is a price Britain’s high streets and leisure venues simply cannot afford.

References

• Economic modelling of potential MGD increases (September 2026), EY Report for the Betting and Gaming Council