Summary
The Dutch government's decision to implement a tax hike on gambling has resulted in a significant shortfall of €200 million in gambling tax revenue, according to recent reports. The tax increase, which raised the gambling tax rate from 30.5% to 34.2% in January 2025, was intended to boost revenue, but instead, it has led to a 25% drop in Gross Gaming Revenue (GGR) in the first half of 2025 compared to the record high in 2024 [1][2].
The phased tax increase will continue, with a further jump to 37.8% of GGR scheduled for January 2026, affecting all gambling sectors. However, critics, including Brancheorganisatie VAN Kansspelen, have described the tax hike on gambling as "ineffective, inefficient, and completely counterproductive."
The potential consequences of this tax hike on the legal gambling market are numerous. Reduced legal gambling revenue is a significant concern, as consumers may shift their betting activity to untaxed or less-taxed illegal or offshore gambling options to avoid the higher tax burden. This shift could lead to a shrinking legal market, further exacerbating the revenue shortfall.
Moreover, the higher tax rate can discourage player participation or betting volume in regulated Dutch casinos and platforms, shrinking the taxed market size. As a result, the government might need to reconsider the tax rate, as the increased percentage has not translated into increased revenue but instead lowered total tax revenue due to decreased market activity [1][2].
The shrinking legal market, lower-than-expected revenues, and growing black market activity now threaten the policy's original aims. A further tax hike is on the horizon, increasing pressure on policymakers to reassess the balance between regulation, taxation, and market sustainability.
In a government-commissioned study last year, Atlas Research predicted that higher taxes could force operators to reduce services or exit the Dutch market, potentially leading to greater black market activity. The current situation appears to be aligning with this prediction, posing a significant challenge for the Dutch government.
[1] [Source 1] [2] [Source 2]
- The online casino, sports betting, and poker industries are grappling with a potential shrinkage in the legal Dutch market, as consumers might shift to untaxed or less-taxed sources to circumvent the higher tax burden.
- The phased tax increase in the finance sector has led to a drop in Gross Gaming Revenue (GGR) for the gambling business in the first half of 2025, and critics argue that the higher tax rate has not bolstered revenue as intended but instead lowered total revenue due to decreased market activity.
- The future of gambling industry regulation in the Netherlands seems uncertain, as the government may need to reconsider the deterrent effect of the increased tax rate, particularly in light of the growing black market activity and lower-than-expected revenues.
