South Africa’s National Treasury is looking for public enter on a brand new proposal that might considerably change the panorama of on-line playing within the nation. As the web betting trade has exploded, the Treasury goals to curb the rising considerations round downside playing whereas boosting authorities revenues with a 20% nationwide tax on gross playing income (GGR) from on-line playing, together with interactive betting.
National Tax to Address Problem Gambling
The proposal, outlined in a dialogue paper, is designed to deal with the social points arising from the fast rise in online gambling. National Treasury emphasised that “recreational gamblers do not place any external costs on society,” however “problem and pathological gambling impose a cost,” which justifies regulation. The goal of the brand new tax is not only to generate income, however to mitigate these social harms by discouraging extreme playing behaviors.
This 20% tax could be as well as to the present provincial playing levies, elevating the general tax burden on on-line playing to between 26% and 29%. The Treasury predicts that the brand new levy might usher in over R10 billion yearly by 2029, serving to to offset the social prices of gambling-related issues.
South Africa’s playing trade has undergone a dramatic transformation, with on-line betting changing into more and more well-liked, particularly after the COVID-19 pandemic. Technological developments and higher entry to cellphones and the web have made playing extra accessible than ever. “Gambling is now easily available online and accessible almost anywhere and at any time,” National Treasury acknowledged, as reported by South African Government News Agency.
According to the National Gambling Board (NGB), the full turnover of South Africa’s playing trade for the 2024/2025 monetary yr reached a staggering R1.5 trillion, representing a 31.3% enhance from the earlier yr. Betting actions, together with sports activities and horse racing, accounted for 75% of this turnover, with on-line sports activities betting and the National Lottery being the most well-liked types of playing.
However, this progress has come at a value. The NGB stories that unlawful playing actions account for around62% of the full playing quantity, pushed largely by unlicensed offshore operators who evade taxes and laws. This unlawful sector is a big problem for native regulators, who’re struggling to oversee on-line playing due to its cross-border nature.
Current Legislative Gaps and the Need for Reform
South Africa’s playing legal guidelines, based mostly on the National Gambling Act of 2004, are outdated and fail to adequately deal with trendy on-line playing. While some provinces, just like the Western Cape and Mpumalanga, have tailored by issuing licenses for on-line on line casino video games, many areas are unable to absolutely regulate the sector.
The proposed nationwide tax goals to streamline the regulatory course of and forestall provinces from competing with each other to entice operators by way of decrease tax charges. By consolidating the tax system on the nationwide degree, it’s hoped that South Africa can higher deal with the challenges posed by the rising on-line playing market.
In reviewing worldwide greatest practices, the Treasury discovered that many international locations with giant on-line playing markets have applied comparable and even larger tax charges. For instance, a number of European international locations and Australia apply taxes of 20% or extra on on-line playing income, which is usually used to fund habit remedy applications and stricter playing laws.
South Africa goals to observe this mannequin through the use of the tax income to fund social applications that deal with gambling-related hurt, comparable to habit remedy and public training campaigns. However, the Treasury additionally cautioned that if the tax charge is simply too excessive, it might drive extra gamblers towards unlawful, unregulated websites, exacerbating the very issues the tax is designed to deal with.
National Treasury has launched the draft proposal for public remark, permitting stakeholders to present suggestions on the deliberate tax and its potential results. The deadline for submitting feedback is 30 January 2026. The public session is a vital a part of the method, as the federal government seeks to steadiness income technology with the necessity to cut back the unfavorable social impacts of playing.
