The Autumn Budget - What it Means for Us

Yesterday the Chancellor of the Exchequer delivered her first budget of this Labour Government. It comes after weeks of speculation around potential increases in Machine Games Duty and other business costs. See below bacta's initial assessment of the implications for our sector.  

Machine Games Duty 

The Government has, despite media speculation, decided not to proceed with an increase in Machine Games Duty.  

In recent weeks Bacta has lobbied hard to put pressure on the Government to back away from this course of action, engaging with the Chancellor, Treasury officials, 10 Downing Street, the Opposition Front Bench, as well as Labour and Conservative MPs. An increase would have been devastating for our sector.  

Employers’ National Insurance Contributions 

It is disappointing to see the Government take the decision to increase Employers’ National Insurance Contributions from 13.8% to 15%. If this goes ahead as planned, the industry can expect to see their operating costs increase as staffing becomes more expensive. This is yet another additional cost to doing business.  

Increase in Minimum Wage 

After the substantial recent increase in minimum wage, it is a further blow to see the Chancellor confirm yet another rise. The rates will now be £12.21 for over 21s and for 18-20 year olds it will rise to £10 per hour, with a long term view to equalize into one adult rate.  

Covid Transitional Relief 

The Chancellor has reduced business rates relief that was instituted during Covid. This means that some hospitality and retail businesses will no longer receive a 75% discount, rather a 40% discounted rate. This will affect some, although not all, of our members. 

Capital Gains Tax  

There will be an increase in  Capital Gains Tax. The lower band will rise from 10% to 18% and the higher rate will increase from 20% to 24%. This will further harm the income of many businesses.  

Inheritance Tax & Private Pensions  

While perhaps not directly applicable to your business, the Chancellor has also announced increases in both inheritance tax and on private pensions.

Other Points to Note 

There are no increases in Income Tax, VAT and Fuel Duty. This will come as a relief to the sector.  

Conclusions  

John Bollom, President of bacta commented, "It is welcomed news that following significant pressure, the Government have backed down on increasing MGD. This had the potential to do significant damage to our industry and we are grateful to our membership for their support in lobbying the Treasury to drop this. 

"That said, this budget will have consequences for our sector and the rising tax burden on businesses will be tough. Staffing will be higher as a result of the Employers’ National Insurance rise and the further hike in Minimum Wage.

"Our focus going forward will be on getting the much needed White Paper reforms across the line, as well as a desperately needed Stakes & Prizes Review as soon as possible. These measures are essential to the future of the sector, particularly after this budget."  

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31 October 2024

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