The Dutch government’s decision to raise the gambling tax will be implemented in two stages, significantly affecting licensees in the country’s regulated market. By 2026, the gambling tax rate will hit 37.8%, with a preliminary increase to 34.2% in 2025. This hike, according to a government report, aims to generate additional revenue of €202 million annually from 2025 to 2028, but it faces considerable opposition from industry stakeholders and experts.
Details of the Gambling Tax Hike
Currently, the gambling tax stands at 30.5%. On January 1, 2025, the first phase of the tax hike will take effect, raising the rate to 34.2%. A year later, on January 1, 2026, the tax will reach its final rate of 37.8%. This tax will affect all gambling operators, including casinos, online operators, and lotteries. Although designed to provide the government with more revenue, industry experts predict significant consequences for both operators and consumers.
The phased implementation was announced in parliament on September 17, 2024, with the government hoping to give businesses more time to adjust. Despite this intention, many operators remain concerned about the potential impact. Political support for the increase comes from parties including the PVV, VVD, NSC, and BBB, with the bill currently awaiting approval in both the lower and upper houses of parliament. Once ratified, the new law will be published in the Government Gazette, allowing it to come into effect.
Industry Backlash and Concerns
The Dutch Online Gambling Association (NOGA) has voiced significant concerns about the increase, arguing that it could destabilize the regulated market. NOGA stated that “this will lead to a further erosion of the regulated supply [of operators]” and further predicted that more consumers might turn to illegal gambling platforms that do not adhere to the same safety measures as licensed operators. The trade body believes that the government’s goal of consumer protection and fraud prevention will be undermined by these changes.
The research agency Atlas Research also issued warnings in its report, stating that online gambling operators will likely struggle to absorb the increased tax burden. The report indicated that some operators might be forced to exit the market altogether or pass on the increased costs to players, potentially driving them towards the black market. As a result, the report concluded that operators “will have to take measures to stay out of the red.”
Holland Casino Faces Significant Struggles
Holland Casino, the state-owned gambling operator, stands to face substantial challenges due to the tax hike. The Atlas report suggested that if Holland Casino cannot absorb the additional costs, it may be forced to close physical branches or even halt its online operations. In August 2024, Holland Casino reported a €3.5 million loss following the 1% tax increase earlier in the year.
Petra de Ruiter, CEO of Holland Casino, expressed her deep concerns about the future, labeling the tax hike as “irresponsible.” She added, “We will then make a significant loss. Unlike supermarkets, we cannot properly pass on price increases.” The operator’s effective tax rate will approach 50% of its revenue under the new regime, which De Ruiter emphasized would make it unsustainable to maintain normal operations.
The company has few options available to mitigate the effects of the tax increase. De Ruiter mentioned that only drastic measures, such as cutting prize money or aggressively acquiring new customers, might balance the financial burden. However, she argued that these actions would be “unacceptable for Holland Casino and irresponsible regarding government policy on gambling.”
Conclusion: What Lies Ahead
As the Dutch gambling industry braces itself for this substantial tax increase, many questions remain about how operators will cope and whether players will shift toward illegal platforms. NOGA and other industry bodies have urged the government to reconsider its approach, warning that the tax hike could result in diminished tax revenues, higher illegal gambling activity, and an overall decline in consumer protection. The industry’s next steps will be critical as the gambling landscape in the Netherlands continues to evolve.
Source:
Dutch Budget confirms gambling income tax hike to 37.8% by 2026, sbcnews.co.uk, September 17, 2024.