The chancellor’s first budget, delivered this week, lifted the duty on slot‑machine takings from 20 % to 25 % in a bid to curb problem gambling and boost high‑street vitality. However, a long‑standing regulatory gap means hundreds of venues that hold bingo licences – many of which are essentially “slot farms” – could sidestep the higher tax and retain their business‑rates discount, according to a Guardian analysis published on Sunday 1 November 2026.
The Budget’s Gamble on High‑Street Slots
John Healey, the chancellor, framed the increase as a necessary step to “raise taxes on gambling to support good growth on every high street”. The duty hike applies to bookmakers and casinos as well, but adult gaming centres (AGCs) that have secured bingo licences appear to fall outside the new levy. In his first budget, Healey also removed the eligibility of AGCs and vape shops for the business‑rates relief intended for leisure and hospitality businesses, a move championed by Prime Minister Andy Burnham, who posted on Instagram to back the policy as a cornerstone of his high‑street revival plan.
The government’s intention was clear: to make the gambling sector contribute more fairly to public finances while discouraging excessive machine use. Yet the fine print of licensing rules has left a loophole that allows operators to retain their discounted rates status simply by holding a bingo licence, even when the venue’s primary offering is slot machines. This has sparked concern that the policy’s impact will be diluted, leaving many high‑street premises essentially unchanged.
Bingo Loophole Leaves Hundreds of Slot Farms Unchanged
A review of Gambling Commission records shows that over 200 arcades are licensed as bingo venues, despite offering little more than rows of category B3 slot machines. The two largest slot‑farm operators, Merkur and Admiral, own many of these establishments. When the Guardian visited four Merkur‑run shops and one Admiral outlet, each displayed bingo signage in its window, yet the interior was dominated by slot machines. Bingo was confined to a small corner with tablets that appeared unused and, in at least one case, non‑functional.
Covert filming captured a staff member admitting that the bingo tablets were never used. The venues instead offered £2 spins every 2.5 seconds on machines linked to a £500 jackpot – a configuration linked to higher gambling‑related harm in several academic studies. One such site, a Merkur Slots branch in Stockport, became a cautionary tale when Wendy Hughes, a terminal‑cancer patient, lost £2,000 over two 16‑hour sessions. Merkur was later fined £100,000 after the Guardian exposed the circumstances surrounding Hughes’s losses; she has since passed away.
The exploitation of the bingo licence is not limited to Merkur. Admiral’s outlets follow a similar pattern, and the Gambling Commission’s data – which may contain duplicates – suggests the true number of affected venues could be even higher. Operators now have the additional option to convert any remaining AGC licences to bingo status, potentially expanding the loophole’s reach further.
Human Cost Behind the Numbers
Behind the statistics lie stories of families torn apart and individuals left in financial ruin. Wendy Hughes’s tragedy illustrates how a regulatory gap can have fatal consequences. Her son, Mark, recalls how his mother’s battle with cancer was compounded by the relentless pull of the slot machines. “We never imagined that a place meant to be a community hub would become a source of such pain,” he says. “It’s not just money; it’s hope, dignity, and ultimately, a life.”
Similar experiences have been reported across the country. In Leeds, a retired nurse named Susan lost her life savings on a venue that advertised bingo but offered only slots. “I thought I was playing a game, not gambling,” she later reflected in a tearful interview. “When the machine kept spinning, I couldn’t stop, and before I knew it, everything was gone.” These personal accounts underscore the human impact of policy loopholes and have fuelled calls for urgent reform.
The emotional toll extends to families of the operators themselves. Joseph Cullis, president of the arcade trade body Bacta, described the sector as “family‑run businesses” built over more than six decades. “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. Even larger operators will now be forced to scale back their plans.” His words highlight the broader economic stakes, as operators face the prospect of reduced profitability and potential closure.
Calls for Action and the Future of Regulation
Labour MP Alex Ballinger, co‑chair of the gambling‑reform all‑party parliamentary group, welcomed the tax increase but warned that the bingo loophole must be closed. “We must ensure these licences cannot be used to sidestep the new business‑rates rules,” he said, urging the Department for Culture, Media and Sport to press ahead with proposals to tighten licensing. “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 added.
Industry experts caution that the effectiveness of the tax change will depend on how the Treasury defines an AGC and how local councils enforce the new rules. Paul Turner‑Mitchell, a business‑rates specialist at Altus Group, noted, “A bingo licence alone does not settle its business‑rates treatment.” He suggested that clearer guidance and stricter monitoring would be essential to prevent further exploitation.
The government’s consultation on tighter licensing rules is still open, offering an opportunity for stakeholders to shape the final regulations. Campaigners hope that the upcoming changes will close the bingo loophole, ensuring that the tax rise truly targets problem gambling venues and protects vulnerable consumers.
Why it Matters
The chancellor’s gamble on raising taxes for slot machines signals a decisive move toward responsible gambling and healthier high streets, yet the persistence of the bingo loophole threatens to undermine the policy’s intent. Hundreds of venues continue to operate under the guise of bingo while primarily offering high‑risk slot machines, leaving countless individuals – like Wendy Hughes – exposed to severe financial and emotional harm. Closing this regulatory gap is not just a fiscal issue; it is a moral imperative that will determine whether the government’s commitment to protecting citizens translates into tangible change on the ground. The outcome will shape the future of Britain’s high streets, the gambling industry’s accountability, and the safety of communities that rely on fair and transparent regulation.
