Hundreds of high street “slot farms” across England could continue benefiting from business rate discounts unless ministers close a regulatory loophole that allows them to register as bingo halls.
In his first budget, Chancellor John Healey targeted adult gaming centres (AGCs) by raising the duty on slot machine revenues from 20% to 25%, stating the measure was aimed at “raising taxes on gambling to support good growth on every high street.” Alongside the duty increase, which impacts casinos and bookmakers, the government ruled that English AGCs and vape shops would no longer receive business rate discounts meant for leisure and hospitality firms. Making it hard to measure exact numbers, some data is duplicated.
Regional leaders have backed the move, with Prime Minister Andy Burnham using Instagram after the budget announcement to support the tax hike as part of his strategy to revitalize British high streets.
Analysis indicates that venue operators including Merkur and Admiral, two of the UK’s largest slot farm companies, could bypass the higher business rates by holding bingo licences for sites focused almost entirely on slot machine play. Gambling Commission records reveal that over 200 arcades operate under bingo licences despite their main focus on slot machines.
Visits to four Merkur venues and one Admiral location showed bingo advertised on window displays, yet the game was only accessible on tablets stored in small corners of the premises. Covert footage inside one arcade recorded a staff member admitting that no one used the bingo devices and that they appeared non-functional.
The bulk of these arcades is dedicated to category B3 slot machines, which allow £2 spins every 2.5 seconds for a maximum £500 jackpot—a product linked by research to higher rates of gambling harm. One such venue, a Merkur Slots branch in Stockport, hit the headlines after terminal cancer patient Wendy Hughes lost £2,000 over two 16-hour sessions. Merkur was later fined £100,000 following coverage detailing her exploitation before her death. According to several studies, these category B3 machines are associated with higher levels of gambling-related harm than most other products. Merkur was fined £100,000 after revealed the details of Merkur’s exploitation of Hughes, who has since died.
With duplication in official datasets making precise tracking difficult, experts warn operators could also convert remaining AGC sites to bingo licences to retain rate relief.
Alex Ballinger, Labour MP and co-chair of the gambling reform all-party parliamentary group, praised the higher slot taxes but warned that enforcement is crucial. “We must ensure these licences cannot be used to sidestep the new business rates rules,” Ballinger said, urging the Department for Culture, Media and Sport to proceed with planned reforms during its ongoing consultation. He urged the Department for Culture, Media and Sport to proceed with proposals to tighten the licensing rules, amid a consultation. “The government has already recognised this problem, and I am confident ministers will work with the regulator to close loopholes and ensure enforcement going forward,” he said.
Paul Turner-Mitchell, a business rates expert at real estate intelligence firm Altus Group, noted that tax outcomes will depend on local council enforcement and Treasury definitions, stating that “a bingo licence alone does not settle its business rates treatment.” Merkur and Admiral did not respond to requests for comment.
Industry representatives expressed concern over the budget changes. Joseph Cullis, president of the arcade trade body Bacta, warned that operators face severe financial pressure. Cullis shared that his family business began in 1962 and explained that the decision will force family-run arcades and larger operators alike to scale back investment plans and make difficult operational choices. “My great-grandfather started our family business back in 1962, and we’ve spent more than 60 years building it into what it is today,” he said. “Like many of the family-run businesses I represent across the sector, this decision will force us to reconsider investment and make difficult decisions about our future.
