Slot Operators Exploit Bingo Licence Loophole to Avoid Rates Surge After Duty Hike

Chancellor John Healey announced the Autumn Budget on 28 October 2026 with a rise in Machine Games Duty from 20% to 25% on higher-stake and prize machines, a change scheduled to take effect from 1 April 2027, and this measure targets casinos, betting shops plus adult gaming centres while leaving pubs and arcades untouched.

Operators running hundreds of high-street slot venues now examine ways to limit exposure to full business rates charges, and venues operated by firms such as Merkur and Admiral hold bingo licences that qualify them for discounted rates intended for leisure and hospitality premises despite their primary focus on slots.

Details of the Duty Increase

The government published guidance on Machine Games Duty changes that set out the new 25% rate applying to machines offering stakes and prizes above defined thresholds, and this adjustment forms part of broader fiscal measures aimed at high-street regeneration and reduced gambling harm.

Venues classified under bingo licences currently receive business rates relief structured for hospitality and leisure use, which means operators can maintain lower annual property costs even when the majority of floor space and revenue comes from slot machines rather than traditional bingo sessions.

How Bingo Licences Create the Classification

Under existing local authority rules, premises with bingo licences receive treatment aligned with leisure facilities, and this classification persists because the licence itself satisfies the eligibility criteria regardless of how operators allocate actual gaming floor space or revenue streams.

Figures from industry monitoring in November 2026 show that many such sites generate over 80% of income from higher-stake machines, yet the bingo licence status continues to shield them from standard commercial rates applied to pure gaming venues, and this discrepancy has drawn attention following the budget announcement.

Impact on Specific Operators and Locations

Merkur and Admiral operate numerous high-street sites across the UK that already hold bingo licences, and these operators now review whether the existing licence framework allows continued access to the discounted rates after the duty rise begins in April 2027.

Local councils process rates bills based on the primary licence category rather than daily operational emphasis, which means venues that once hosted bingo events retain eligibility even when bingo activity has declined sharply in recent years.

Policy Intent Versus Current Application

The budget measures sought to support high streets by adjusting tax burdens on gambling premises and simultaneously addressing harm reduction goals, yet the bingo licence route allows certain operators to maintain lower overheads that the policy changes did not directly address.

Observers tracking regulatory developments note that the distinction between licence type and actual use creates a pathway that some venues can follow, and data collected by local authorities in late 2026 already records multiple sites operating under this dual classification.

Regulatory and Local Authority Responses

Councils retain authority to review rates classifications when material changes occur in premises use, and several authorities have begun preliminary assessments of slot-heavy venues that hold bingo licences to determine whether reclassification proceedings should begin.

Operators maintain that compliance with existing licence conditions satisfies all current requirements, and they continue to file rates returns under the leisure category while preparing for the higher Machine Games Duty liability starting next April.

Conclusion

The interaction between the Machine Games Duty increase and business rates relief through bingo licences produces a situation where hundreds of high-street venues may experience limited net impact from the full package of budget measures, and this outcome stems directly from the licence categories already in place before the 28 October 2026 announcement.

Further clarification from government departments and local authorities remains pending as November 2026 progresses, with operators and councils both monitoring how the April 2027 duty change aligns with existing rates frameworks.