Could Andy Burnham risk giving with one hand but taking away with another in his bid for economic support of UK pubs?
Among sweeping changes, one of the Prime Minister’s marquee policies within his first week in office has been to slash business rates on pubs, social clubs and live music venues by 20%.
However, in a recent interview, he has all but confirmed greater taxes on adult gaming centres (AGCs) as the key source of funding for the policy, citing the venues as causing greater social harm to communities.
As a result, it appears inevitable that machines are set to feel the burn of new tax policies. With B2 gaming machines likely the first in the crosshairs, B3 gaming machines that are a fixture of pubs up and down the country could also be next in the firing line.
Any move here should be handled with caution from Burnham, as they could be of significant detriment to the same sector he is so adamant on saving.
Investor presentations when the pub giant Wetherspoons first rolled out gaming machines in 2018 suggested that they would provide around 25% of the group’s profits.
Assuming a profit margin of 5% for other aspects of the business, the Financial Times projects that the percentage of profits from gaming machines will sit at 27% for the 2026 financial year, in comparison to 30% for food.
Although food contributed revenue of £807.9m in the 2025 financial year compared to £73m for slots, the respective profit margins illustrate the importance of gaming machines to the coffers of Wetherspoons.
Amid talk of significant tax hikes across the board during last year’s Autumn budget led by Rachel Reeves, Wetherspoons’ owner Sir Tim Martin warned that an increase on machine gaming duty would severely impact the chain’s profits.
Reeves had been weighing a machine gaming duty increase from 20% to 50%, as suggested by former Prime Minister Gordon Brown. However, Martin told The Times that such a move would have slashed the company’s post-tax profits by 48%.
According to Wetherspoons’ financial results, the group paid 18.2m in gaming duty during the 2025 financial year, amid a total tax bill of £837.6m.
Retail gambling was largely spared as part of Reeves’ economic bill, but the sector is now firmly back under the microscope as Burnham and his new Chancellor, John Healey, seek to reverse a struggling UK economy.
Wetherspoons is unique within the UK pub industry in that it provides details of the revenue it derives from gaming. However, it is safe to assume that similar pub chains are also deriving significant revenue from machines at a vital time for the sector.
With the news that two pubs closed per day in the first three months of 2026, equating to 2,400 job losses, it’s clear why the sector is an early focus of the new Prime Minister.
However, while the 20% business rate cut is expected to save each pub more than £1,000 per year, the government risks eating into this windfall if it chooses to expand its targeting of the gambling sector beyond adult gaming centres.
