On Wednesday, prominent leaders from the UK casino industry cautioned that a proposed increase in machine games duty (MGD), potentially doubling it, combined with broader economic challenges, could hinder investment and jeopardize jobs as the sector aims to modernize.
This warning emerged during a panel discussion at London's Hippodrome Casino, where executives from major operators like Rank Group, Genting Casinos, and the Hippodrome shared the stage with representatives from the Night Time Industries Association (NTIA) and consultancy Regulus Partners.
Richard Harris, CEO of Rank Group, voiced his worry about the compounding burden of higher taxes, stricter regulations, and increasing operating costs. "In my four and a half years, we’ve closed four of our venues," Harris noted, attributing these closures to the challenging financial landscape marked by escalating costs and regulatory pressure that have severely impacted profitability.
Harris further indicated that the mere speculation about tax hikes has already influenced investment strategies. This sentiment was echoed by Paul Willcock, COO of Genting Casinos, who remarked that thoughts of MGD increases have been “keeping us all awake.”
A potential rise in MGD from 20% to 40% was suggested by the Social Market Foundation and could feature in the government's forthcoming autumn budget. The industry has vehemently opposed this proposal, arguing that it could adversely affect retail operations.
In September, Fred Done, owner of Betfred, warned that such a tax increase would compel his company to shut down 495 stores within a year, resulting in 2,575 job losses and an estimated £67 million lost in tax revenue for the Exchequer.
“If we can get some relaxation or at least certainty on that, then investment will flow,” Willcock asserted, emphasizing that Genting is ready to expand within the UK if the regulatory and fiscal landscape remains stable. He mentioned Genting's substantial global investments, having allocated $5 billion on the Las Vegas Strip over five years, along with $5 billion in New York and $3 billion in Singapore.
“It is itching to invest in the United Kingdom,” he said.
Simon Thomas, executive chairman of the Hippodrome, framed the conversation around maintaining industry confidence, asserting that operators need guarantees about the consistency of the playing conditions and the broader regulatory and financial climate over investment periods of three to seven years.
Harris reinforced this point, stating, "profit is the source of future investment,“ emphasizing that stable conditions allow operators to effectively generate and deploy profits.
The panel applauded the Gambling Commission's 2025 land-based modernization reforms, which increase the number of slot machines per casino from 20 to up to 80 and relax regulations on ancillary betting. Harris shared that Rank Group had expanded its machine portfolio by about 65% from 1,400 to 2,250 machines, investing £15 million in one venue, all facilitated by these reforms.
However, the participants acknowledged that such changes take time to fully implement and stressed the necessity of tax stability alongside regulatory relaxing for the sector's growth.
Dan Waugh, a partner at Regulus Partners, emphasized the importance of evaluating whether these reforms have genuinely enhanced customer experiences and broadened the sector's appeal, asking, “Are these better places to go to as a result of the regulated reforms? And also, is the experience more widely attractive?”
A potential MGD increase could lead to a steep reduction in employment within the casino sector, which has identified an investment pipeline of about £200 million over the coming years, according to the panel.
Michael Kill, CEO of the NTIA, highlighted the broader economic advantages of sustained casino investments, including backing local economies, jobs, and supply chains. In a report shared by the NTIA, Kill stated that 58% of respondents identified casinos as their primary reason for visiting an area, while 55% indicated they would likely not have visited without the casino's presence.
Additionally, the NTIA found that should the MGD increase occur, job losses, both direct and indirect, could amount to roughly 3,800 nationwide. A survey encompassing 23 operators revealed that 95.7% would decrease staffing levels, and 91.3% would cut investments in their venues. Alarmingly, 60.9% of operators might feel compelled to close a venue altogether.
The panelists emphasized the critical role casinos play as significant employers and community contributors. Willcock pointed out that Genting employs around 3,500 individuals in the UK and highlighted the intensive training programs, saying, "There’s significant training, six weeks training before anybody can go anywhere near a casino table.”
Kill and Waugh further discussed the societal impact of casinos, underscoring the enhanced perception of safety in town centers during late-night hours and the venues’ role in hosting community events. Kill added an often-overlooked detail: “People coming after midnight actually felt safe because of the service levels, because of the engagement, the lighting, etc.”
Panelists jointly urged the government to allow its 2025 reforms to fully take root without imposing immediate tax hikes. Kill called for “a chance to bed in” these reforms, stressing the significance of casinos in supporting around-the-clock economies.
Willcock and Harris mentioned that a clear and enduring fiscal framework would stimulate further large-scale investment. Waugh cautioned against policy overly guided by “public health dogma,” advocating for balanced regulations that both safeguard consumers and foster sustainable business growth.
Recent analysis by Regulus indicated that should the duty rise, the horse racing sector could lose roughly a third of its annual revenue, amounting to about £92 million.
Kathryn Evans covers breaking news with a focus on EMEA and US legislation, bringing insight from her background as a fluent Welsh speaker and a long-time Wrexham FC supporter.
