Tenanted pubcos will earn around £3 less each week from every gaming machine when the VAT hike comes in next January.
Managed operators will earn around £5 less, according to the Independent Operators Association (IOA), which represents 20 machine operators nationally that supply major pubcos and managed pub companies.
It was announced in last month's Emergency Budget that VAT will rise from 17.5% to 20% on 4 January 2011,
Ken Mullarkey, IOA national sales executive, said: "Whilst other industries and retailers are able to pass on this increase to the end-user we are not.
"Price of play is fixed and so our customers will be asked to dip into their pockets yet again.
"Managed customers will see a reduction of on average £5 per machine/week in their profits, nearly 3%.
"This comes on top of the 3.6 per cent hit on Amusement Machine Licence Duty announced in the last Budget, which will impact from September in most cases.
"Tenanted groups will typically see £3 per machine/week wiped off their share of income."
No figure has been supplied for the typical tenant.
IOA companies supply operators including Punch, Marston's, Greene King, Scottish & Newcastle Pub Company, JD Wetherspoon, Town & City Pub Company and Barracuda.
Mullarkey added: "The IOA Group is concerned that this erosion of income is creating an environment in which rentals are coming under pressure, at the very time when operators' costs are rising steeply, particularly fuel prices.
"With the introduction of new technologies and pressure to introduce new income enhancing solutions such as note recyclers to our machines, recovering the cost of these will become that bit more difficult."