Gambling shares rally despite UK Machine Games Duty rise
Entain, evoke and Rank Group all gained on the London Stock Exchange after the Autumn Budget set a smaller-than-feared duty increase on Category B machines.
Shares in the UK's largest listed gambling companies rose sharply on Tuesday even after the government confirmed a tax increase on gaming machines in the Autumn Budget.
Chancellor of the Exchequer John Healey announced that Machine Games Duty on Category B machines will rise from 20% to 25% from 1 April 2027, SBC News reported. The move continues a run of fiscal pressure on the sector under Prime Minister Andy Burnham's administration, which has repeatedly turned to gambling taxation to help fund the Treasury.
The rise fell well short of the 40% some had lobbied for, and investors appeared to have priced in a harsher outcome. Entain, evoke and Rank Group had all seen their share prices weaken over the preceding twelve months as regulatory and fiscal pressure built in the UK market.
Entain's stock climbed 4.86% to 474.7p by 2:30pm GMT, according to SBC News, having jumped from 456.4p to 484.1p in the ten minutes after the announcement. Group chief executive Stella David had previously warned that an MGD increase "threatens the viability of many" of the company's Ladbrokes and Coral shops.
William Hill owner evoke rose by more than 4% to 44.75p. The company is currently the subject of a takeover by Bally's Intralot at 52p per share. Its retail estate has already been reduced following earlier increases to Remote Gaming Duty and General Betting Duty, and the new MGD rise adds further pressure to a shrinking network, even if the impact is lighter than had been feared.
Rank Group recorded the sharpest gain, with its shares up by more than 10% to 86.9p. The group is heavily exposed to gaming machine revenue: machines produced £60.1m of the £143m in net gaming revenue generated by its Mecca venues in 2025/26, and almost 30% (£113.2m) of Grosvenor Casinos' £397.3m NGR over the same period.
Rank chief executive Richard Harris had warned that a doubling of MGD would force the closure of roughly a third of the company's estate. A five-point rise is unlikely to trigger that scale of restructuring, which analysts suggest explains the scale of the relief rally in Rank's share price.
SBC News noted that a tax increase remains a tax increase, regardless of how markets have reacted. The shift from 20% to 25% MGD is being read in the industry as a further signal that the government intends to keep drawing revenue from gambling operators rather than easing the burden on them.
Share price gains on public markets do not necessarily translate into improved conditions for retail estates or staffing levels, and operators will now turn to assessing how the 2027 implementation date affects investment and store-closure decisions already under consideration.