Raised gambling taxes in the Netherlands prove ineffective, admits regulatory body
The Netherlands is experiencing a challenging period in its gambling industry, with a significant drop in gross gaming revenue (GGR) and tax contributions to the state coffers. The Dutch Gambling Authority's (KSA) decision to increase the gross gaming revenue tax from 30.5% to 34.2% starting in January 2025 has negatively impacted the market and consumer protection.
The tax hike has contributed to a notable drop in GGR by around 25% in the first half of 2025, causing a corresponding decline in tax revenues—approximately a €200 million shortfall compared to projections. This downturn has particularly affected the land-based gambling sector, which lacks opportunities to offset higher taxes, leading to a higher rate of venue closures (9% drop in physical venues in Q1 2025).
Operators face increased financial pressure, making it harder to maintain profitability without cutting costs or raising prices, which can deter players. To compensate, some operators have turned to stronger consumer protection measures, such as deposit limits and affordability checks, introduced by the KSA in October 2024. However, the regulator acknowledges that a financially strained market due to tax hikes undermines responsible operators and harms the long-term goal of a safe gambling environment.
The KSA's tougher policies have also led to a loss of market share to unlicensed operators. With the encroaching black market, the regulator is now forced to take extra measures to remain operational and competitive. The Dutch Gambling Authority (KSA) has admitted that its policies may be leading to the deepening of illegal gambling in the country and sapping the competitiveness of the licensed gambling sector.
Trade groups such as VNLOK have backed early estimates that the tax increase may be counter-productive, with the loss expected to increase to €200m by the end of the year. The Dutch Gambling Authority's Chairman, Michel Groothuzien, made this admission in a statement published on the regulator's official website.
The Head of Casino Research at our website, Matej Novota, states that regulators aiming for short-term tax gains may lead to long-term costs such as shrinking choice, weakened protection, and a closed market. A financially sound, legal market is essential for the protection of players, according to the Dutch Gambling Authority.
Despite achieving a high level of channelization (90%), currently, 50% of the total gambling spend in the country is placed with offshore operators. The tax rate was increased from 30.5% to 34.2% on January 1, 2025. The KSA considers increasing taxes on the gambling industry to be "at odds" with its goal of offering players a better level of protection.
The Dutch Gambling Authority is one of the strictest gambling regulators, and a viable, financially sound regulated market with responsible providers is essential for effective player protection and sustainable government revenues. If no policy adjustments occur, the tax rate is scheduled to rise further to 37.8% in January 2026, risking deeper negative effects on the gambling industry.
References:
- Dutch Gambling Authority's official website
- VNLOK's official website
- Matej Novota's official website
- EUROSTAT
- The Guardian
- The higher taxes on the gambling industry in the Netherlands, aimed at increasing government revenues, are leading to a decrease in gross gaming revenue, a loss of market share to unlicensed operators, and a deepening of illegal gambling.
- The Dutch Gambling Authority (KSA) recognizes that its strict policies and higher taxes are undermining responsible operators and harming the long-term goal of a safe gambling environment, potentially leading to shrinking choices, weakened protection, and a closed market.
- Some stakeholders, including trade groups like VNLOK and experts like Matej Novota, argue that the Dutch Gambling Authority's focus on short-term tax gains may have long-term costs for both the gambling industry and consumers, as financial pressure on operators can affect player protection and choice in the market.
