Dutch gambling regulator, Kansspelautoriteit (KSA), has expressed concerns that recent gambling tax hikes could undermine player protection.
The increase from 30.5% to 34.2% on January 1st, 2025, will rise again to 37.8% in 2026, potentially reducing gambling tax revenue by 5% this year.
The KSA’s assessment suggests that the higher tax rate, combined with strict regulations like deposit limits, may inadvertently strengthen the unlicensed market.
Michel Groothuizen, KSA’s Chairman, said: “The measures we have taken to offer players more protection have made it financially more difficult for providers.”
He added that such financial pressures result in decreased GGR and, ultimately, lower tax revenues.
The assessment showed a notable impact on operators. Online gaming saw an 8% drop in GGR in Q1 2025 compared to Q4 2024, remaining stable in Q2. The introduction of stricter player protection rules in October 2024 contributed to this trend, suggesting a decrease in player activity or losses. Operators faced a 12% reduction in funds available to cover costs after taxes.
In land-based casinos and arcades, a 4% decline in GGR was observed in Q1 2025 compared to Q4 2024, with stability in Q2. This situation left operators with 10% less to manage their expenses, leading to a 9% reduction in the number of locations.
Both online and land-based operators experienced a monthly NGR decrease by 8% and 10%, respectively.
The KSA caution that operator attempts to absorb the tax rise might lead to reduced player payouts and bonuses, potentially driving players to illegal platforms. Although 91% of players used legal sites exclusively in Q1 2025, legal operators accounted for only 51% of GGR.
The KSA concludes: “The gambling tax increase has had no direct impact on channelisation but may eventually cause some players to turn to illegal operators if legal operators reduce payout percentages or limit their offerings.”
