A new tax on gaming machines, called “Machine Games Duty”, due to be introduced in the April 2012 budget, will for the first time apply to pub quiz machines meaning the machines may be less attractive for publicans. The new tax will replace the current Amusement Machine Licence Duty (AMLD) and will be a “gross profits” tax. Leading gambling law solicitor Stephen McGowan, Director of Licensing and Gambling at Lindsays, said: “I have expressed concern before that this new tax will lead to the death of the pub quiz machine. We have now seen the new structure and as things stand, there are two bands of this new tax and disappointingly skill machines like pub quiz machines are in the higher band”.
McGowan, who is the author of 3 books on gambling law added: “The implication is that classic pub quiz machines like “Who wants to be a Millionaire” will be become unviable and publicans will look for alternatives. These machines are not part of the current tax regime because they are not gambling machines. Winnings rely purely on the player’s skill and knowledge, as opposed to luck and chance. But the new regime has purposefully removed this distinction in order to “catch” skill machines and thereby increase revenue for the taxman”.
“I am not simply worried about the publican or indeed his customer who may miss the quiz machine, but also the companies who manufacture and supply these machines who are already struggling as the arcade industry is experiencing a difficult trading environment just now. This new tax could push some of these companies over the edge, if demand from pubs for quiz machines drops”.
The exact levels of taxation will not be announced until next year’s budget.
If you would like to discuss any of the issues raised in this article please contact Stephen McGowan.
