The last of five £20 notes disappears into the slot machine as The Verve's Bittersweet Symphony plays over the shop's sound system.

That's it, £100 gone in the space of about five minutes, swallowed up by one of the many "slot farms" that dominate the shopping streets of Peterborough.

All that's left to show for it is a free KitKat, one of the incentives staff use to tempt customers into staying a little longer and losing a little more.

It's lunchtime on a Thursday and dozens of glassy-eyed hopefuls are having the same experience, feeding in what little cash they have and cursing as it disappears.

The same pattern is repeated across the country. Gamblers in Great Britain lost £2.7bn on slot machines last year, nearly double the annual budget of the Department for Culture, Media and Sport, which oversees the sector.

In his inaugural budget this week, the chancellor, John Healey, took direct aim at slot machines by raising "machine games duty", the tax levied on them, from 20% to 25%. This, he said, would bring in nearly £150m a year, "raising taxes on gambling to support good growth on every high street".

But what is the reality of Britain's booming slot machine industry and why is it in the government's crosshairs?