Rank says Budget changes to dent annual operating profit by £40m

(Sharecast News) - Grosvenor Casinos and Mecca Binga owner Rank Group said on Wednesday that the new measures announced in the Budget are expected to dent annual operating profit by around £40m before mitigation. In her long-awaited Budget, Chancellor Reeves announced a number of changes that are expected to raise £1.1bn by 2029-30.

From April 2026, there will be an increase in remote gaming duty from 21% to 40% and the abolition of bingo duty from its current 10% rate, Reeves said.

She also said that from April 2027, a new rate of general betting duty for remote betting will be introduced at 25%. This will exclude self-service betting terminals, spread betting, pool bets, and horseracing.

In addition, the government announced a freeze in casino gaming duty bands in 2026-27, with the usual retail price index uprating thereafter.

Rank said the annualised impact on the UK digital business of the increase in the RGD rate will be an additional duty cost of around £46m. This will be offset by a benefit of around £6m from the abolition of bingo duty.

The impact of the 4.1% increase to the hourly National Minimum Wage and other changes to employment taxes are within Rank's expectations, it said.

The company said it was reviewing various mitigating actions for the digital business.

Chief executive John O'Reilly said: "The announced increase in remote gaming duty in the UK budget represents a very significant blow to the regulated betting and gaming industry in the UK.

"Whilst we are pleased that the government has abolished bingo duty which will help to sustain jobs and investment in the land-based sector, the far more significant impact on the group is the hit to digital profitability.

"In the year to 30 June 2025, Rank reported a profit after tax of £44.6m and paid taxes in the UK of £188m. That burden will now increase by a further £40m and we will look to mitigate the impact where possible."

Rank shares closed up 12% at 120p.