Bacta survey shows Machine Games Duty rise would see business closures, job losses and a freeze on investment

90 per cent said the increase would have a ‘severe negative impact’

The devastating impact of a potential increase in Machine Games Duty (MGD) has been put underlined by the findings of a membership survey conducted by Bacta, the UK’s land-based trade association.

Conducted prior to the confirmation of Andy Burnham as UK Prime Minister the survey findings paint a bleak picture characterised by business closures, job losses and a decline in capital investment – all of which will cause distress throughout the industry supply chain and in local economies.

Asked about the impact that a ‘significant’ increase in MGD would have on their business all respondents said it would be negative, with 90 per cent quoting a ‘severe negative impact’: the remaining 10 per cent qualified the impact as being ‘moderately negative.’Asked to identify the biggest challenge should MGD be increased by the new Prime Minister, the single biggest response was Remaining Profitable (67 per cent) followed by Maintaining Staff Levels (23 per cent) and Investing in New Machines and Refurbishment programmes (10 per cent).

The overwhelming majority (87 per cent) said an increase in MGD would make a downturn in investment Very Likely. The most likely consequences of a shift in MGD are the closure of some Adult Gaming Centres (43 per cent of respondents), a downturn in profitability (30 per cent) and fewer jobs (27 per cent).

Bacta President Joseph Cullis said: “The latest survey of members supports our position that raising taxes on gaming machines will only serve to damage high streets, seaside towns, members clubs, pubs, bingo clubs, machine manufacturers and the wider supply chain. If the licensed, regulated sector retracts it will be the illegal unregulated sector that benefits.

“Furthermore, many seaside piers and amusement arcades rely on income from gaming areas to stay viable year-round. That income helps keep staff employed and It helps maintain attractions and buildings that are part of Britain’s coastal heritage. Our industry already carries a heavy and highly specific tax burden. An increase in MGD would serve to tax the industry into terminal decline when what’s needed is a fair, responsible and progressive environment in which our industry can contribute to the Government’s economic growth agenda.”