Thu. Sep 19th, 2024
Government plans staggered rollout for Netherlands gambling tax hike to minimise impact

The Netherlands’ gambling tax hike is to be implemented in two phases, with licensees facing a 37.8% GGR tax from 1 January 2026. The increase comes despite government-commissioned research warning it will push licensees out the market.

The staggered approach, unveiled in the Netherlands parliament yesterday (17 September) aims to minimise the impact on the Dutch gambling industry by giving operators more time to adapt to the shift.

The tax rate, currently set 30.5%, will initially jump to 34.2% of GGR on 1 January 2025.

The full increase will come into effect from 1 January 2026 and will hit all verticals and channels, from casinos and gambling halls to lottery and online. The government expects to generate additional tax revenue of €202m per year between 2025 and 2028.

First presented to parliament in May, the gambling tax hike was backed by the PVV, VVD, NSC and BBB political parties.

The bill has yet to pass through the Lower and Upper Houses of Parliament. Once ratified by each chamber, it is published in the Government Gazette so the law can take effect.

Tax hike will lead to “erosion” of gambling industry says NOGA

Industry trade body NOGA today (18 September) condemned the move, insisting it will “lead to a further erosion of the regulated supply [of operators].”

“At the same time, an increase in illegal and therefore riskier gambling can be expected,” it warned.

“This is at the expense of the general policy objectives of the Dutch gambling policy, which are precisely aimed at consumer protection and the prevention of fraud, crime and gambling addiction.”

It urged the government to open discussions with the industry.

Report warns tax hike will force Netherlands gambling licensees from the market

A report by research agency Atlas Research warns the tax increase could push online operators to exit the market.

Presented during the budget the report said operators “will have to take measures to stay out of the red”.

Players could be pushed into betting via the black market, it said, as operators attempt to pass on the increased costs to players.

Holland Casino: Gambling tax hike is “irresponsible”

The Netherlands’ state-owned gambling operator Holland Casino also faces a significant impact from the tax hike, the Atlas report warned. If Holland Casino is not able to absorb the increased tax costs, it will have to close physical branches or shutter its online operations, the report suggested.

In August following its earnings report for the first half of 2024, Holland Casino said the measure would make it impossible to operate profitably.

Chief executive Petra de Ruiter insisted the gambling tax hike was “irresponsible”. Holland Casino faced losses of €3.5m for the six months to 30 June following the 1% tax increase initiated this year.

A 37.8% rate increased the operator’s effective tax rate to around 50% of revenue, de Ruiter explained. “We will then make a significant loss,” she said. “Unlike supermarkets, we cannot properly pass on price increases.”

Only cutting prize money for players and being more aggressive in customer acquisition would help balance the books, she said. “These measures are unacceptable for Holland Casino and irresponsible with regards to government policy on gambling.”

By Xplayer