Revised Taxation Policy of Dutch Gambling Regulator Proven Inadequate
The Netherlands Gambling Authority (KSA) has reported a decline in gross gaming revenue (GGR) and gambling tax revenues following a significant increase in the gambling tax rate to 34.2%, which took effect on January 1, 2025 [1].
The financial burden imposed by the tax hike has led gambling operators to cut back on advertising and lower payout ratios, making illegal offshore platforms more attractive due to higher bonuses and more favorable payouts [1][3]. The introduction of stricter player protection measures, such as the Responsible Play Policy Rule 2024 and regulations on play limits, has also contributed to the decline. These measures, while intended to enhance player protection, have resulted in lower stakes and reduced GGR [5].
The shift towards unregulated offshore platforms, driven by the tax increase and stricter regulations, has drained activity and revenue from the legal market, further exacerbating the decline [1][2][3].
Impact on Online and Land-Based Sectors
While the online sector has more flexibility to adjust payout ratios and control costs, it has still experienced a decline in GGR. The online market has seen an 8% decrease in GGR during the first quarter of 2025 compared to the previous quarter [3]. The introduction of player protection measures has led to a 29% drop in stakes on online slots [5].
The land-based sector has been particularly affected, with a 9% drop in venues in the first quarter of 2025. This sector, having fewer ways to mitigate the financial impact of the tax hike, has seen a more pronounced decline in GGR and revenue [1][5]. Major land-based operators like JVH Gaming are closing venues in response to these financial pressures [5].
The KSA continues to closely monitor the balance between fiscal objectives and the long-term viability of the regulated market. The authority emphasizes that it continues to track developments related to the channeling of online offerings and the ongoing decline in the number of land-based retail locations [7].
Michel Groothuizen, chair of the KSA, stated that the recent increase in the gambling tax rate has led to a decline in GGR across the market [9]. Groothuizen emphasized that financially motivated measures, such as the gambling tax hike, conflict with the policy goal of improving player protection [10].
The Dutch trade body VNLOK announced that the Dutch government lost EUR 200 million in potential revenue from the gambling sector since the introduction of the new taxation policy earlier this year [8]. Maintaining a safe and regulated gaming environment in the future will require serious, responsible operators, supported by a financially stable legal market.
The Dutch government's new taxation policy on gambling, including the increased gambling tax rate, has driven some operators to resort to illegal offshore platforms due to their higher bonuses and payouts, undermining the casino-and-gambling industry's finance and revenue. Consequently, the KSA's stricter player protection measures, such as the Responsible Play Policy Rule 2024 and regulations on play limits, have inadvertently led to a reduction in gambling trends, including lower stakes and declining gross gaming revenue (GGR), both online and in land-based sectors.
