Dutch gambling sector warns tax rises risk harming regulated market

The Dutch gambling sector has formally raised concerns over recent increases in gambling taxation, warning that the policy may unintentionally weaken the regulated market and reduce public revenue. In a joint letter addressed to the parliamentary finance committee, several prominent industry organizations and state operators argued that the latest tax reforms could undermine the objectives of market regulation.

According to the signatories, rising tax rates on gross gaming revenue (GGR) are placing additional pressure on licensed operators and may encourage some players to seek alternatives outside the regulated system. The organizations emphasize that the issue deserves careful examination to ensure that the Netherlands maintains a balanced gambling framework that protects consumers while sustaining legal operators and public funding.

The letter calls on lawmakers to evaluate the real-world effects of the reforms and to consider whether current tax levels are compatible with the broader goals of the country’s regulated gambling system.

Joint letter from industry and state operators

The letter was submitted by several organizations representing both private and state-controlled segments of the Dutch gambling industry. These include the Netherlands Online Gambling Association (VNLOK), VAN Kansspelen Brancheorganisatie, Dutch Lottery and Holland Casino Group.

Together, these bodies represent a large share of the Netherlands’ regulated gambling sector. Their submission to the Standing Parliamentary Committee on Finance outlines concerns based on monitoring data collected from their members.

According to the organizations, the state’s total gambling tax revenue for 2025 is expected to decline despite the increase in tax rates. Their estimates suggest that government revenue could fall by approximately €43.5 million compared with the previous year. This would represent a decline of about 13 percent, reducing the tax intake from roughly €322 million in 2024 to around €288 million in 2025.

Industry representatives argue that this outcome aligns with earlier warnings that higher tax rates could reduce overall activity in the regulated market. Rather than increasing government income, they contend that aggressive tax policies may limit operator margins and reduce incentives to invest in the Dutch market.

Background to the Dutch gambling market reforms

The Netherlands introduced a major overhaul of its online gambling framework through the Remote Gambling Act (KOA), which came into effect in 2021. The legislation opened the door for licensed online operators while establishing a strict regulatory system aimed at ensuring consumer protection and responsible gambling.

Following the launch of the regulated market, authorities implemented a tax rate on gross gaming revenue set at 30.5 percent. However, further fiscal adjustments were introduced in later years.

In early 2025 the tax rate was raised to 34.2 percent. A second increase followed in January 2026, bringing the rate to 37.8 percent.

Industry groups state that the cumulative impact of these increases has placed the Netherlands among the higher-tax jurisdictions in Europe for gambling operators. While acknowledging the government’s right to set fiscal policy, the organizations argue that the pace and scale of the increases may have unintended consequences for the sustainability of the legal market.

Impact on operators and market activity

According to the organizations involved in the letter, some licensed operators have already taken steps to manage the financial impact of the higher tax rates.

These measures reportedly include stricter cost management strategies, reduced promotional activity and adjustments to product offerings. In certain cases operators have also reviewed their physical operations.

Industry representatives note that the Dutch gambling regulator, Kansspelautoriteit (KSA), acknowledged in August 2025 that the initial tax increase did not deliver the fiscal benefits anticipated by policymakers. The regulator reportedly observed that some operators adopted what were described as safeguarding measures in response to the changing economic conditions.

The letter argues that these developments illustrate how tax policy can influence operator behaviour and market structure. While the regulated system remains operational, industry groups believe that sustained pressure could gradually reduce the attractiveness of the legal market.

Concerns regarding the illegal market

A key concern raised by the organizations relates to the potential growth of unlicensed gambling platforms. According to estimates referenced in the letter, betting activity on illegal online sites may now exceed activity on licensed platforms.

Industry groups estimate that approximately €617 million has been wagered on unlicensed sites compared with about €600 million on licensed platforms. While such figures are subject to interpretation and monitoring challenges, the organizations believe the trend warrants careful attention.

They argue that when players migrate to unlicensed services, several risks arise. These include weaker consumer protections, limited oversight and the loss of tax revenue that would otherwise contribute to public finances.

The letter therefore encourages policymakers to consider the relationship between taxation levels and the attractiveness of the regulated market when shaping future policy decisions.

Declining land-based gambling venues

The letter also references broader structural changes affecting the land-based gambling sector in the Netherlands. Research from Atlas Research and data cited by the gambling regulator indicate that the number of physical gambling venues has declined in recent years.

The available findings suggest that the total number of venues has fallen by approximately nine percent. Industry representatives state that several locations have closed or ceased operations, which they attribute partly to regulatory changes and economic pressures.

Although land-based gambling represents only one segment of the wider market, the organizations argue that these closures demonstrate how regulatory conditions can influence the viability of physical venues.

Effects on sports funding and sponsorship

The organizations also highlight the financial implications for sports organizations. According to their estimates, the Dutch sports sector may have lost between €12.5 million and €15 million in funding connected to gambling partnerships.

This shortfall is partly linked to the prohibition introduced in 2024 that restricts sports sponsorship by gambling operators. While the policy was designed to address responsible gambling concerns, industry groups argue that it has reduced financial support for sports clubs and events.

They note that this issue forms part of a broader discussion about how gambling policy interacts with other sectors of society.

Requests made to lawmakers

In their communication with the parliamentary committee, the organizations outline several requests aimed at improving policy evaluation and decision making.

First, they ask the government to follow through on its commitment to closely monitor the effects of the tax increases on the regulated gambling market.

Second, they request that the findings of this review be incorporated into political discussions expected later this year. According to the letter, the review process should ideally be completed by the second quarter in order to provide timely insights for policymakers.

Third, the organizations encourage lawmakers to consider the broader relationship between taxation levels, illegal gambling activity, player protection and overall tax revenue when designing future regulatory frameworks.

The State Secretary for Taxation, Eugène Heijnen, has previously indicated that the government intends to monitor the situation. Industry representatives hope that the parliamentary finance committee will ensure that this monitoring process remains a priority.

Wider European context

Debates about gambling taxation are not limited to the Netherlands. Across Europe, policymakers are evaluating how regulatory frameworks can balance consumer protection, public revenue and market sustainability.

Some observers have noted that the Dutch experience may provide useful lessons for other jurisdictions considering similar reforms. Countries such as the United Kingdom and several Nordic nations have also explored regulatory changes in response to evolving market conditions.

Within this broader context, the Dutch industry believes that constructive dialogue between regulators, lawmakers and operators will be essential to maintaining an effective regulatory environment.

Outlook for the Dutch gambling sector

The Netherlands remains one of Europe’s more closely regulated gambling markets. The system established under the Remote Gambling Act continues to prioritize responsible gambling measures, strict licensing requirements and consumer protection safeguards.

However, industry stakeholders believe that fiscal policy must also support the stability of the regulated ecosystem. They argue that a well functioning legal market is necessary to achieve long-term policy goals, including player protection and public revenue generation.

As policymakers review the effects of recent tax changes, the debate may ultimately shape the future direction of Dutch gambling regulation.

Conclusion

The concerns raised by Dutch gambling trade bodies reflect an ongoing debate about how best to balance taxation, regulation and market sustainability. While the government has implemented higher tax rates with the intention of strengthening public finances, industry representatives believe that the policy may have unintended consequences for the regulated gambling sector.

By presenting their analysis to the parliamentary finance committee, the organizations hope to contribute to a broader discussion on the long-term effectiveness of the current framework. Their request for detailed monitoring and policy evaluation underscores the importance of evidence-based decision making in complex regulatory environments.

As the Netherlands continues to refine its gambling legislation, policymakers face the challenge of ensuring that the system protects consumers while maintaining a viable legal market. The outcome of the upcoming policy review may therefore play a significant role in determining how the Dutch gambling sector evolves in the coming years.

FAQs

What concerns have Dutch gambling organizations raised about tax increases?
Industry groups believe higher gambling taxes may reduce activity in the regulated market and potentially lower overall public revenue.

Which organizations signed the letter to the parliamentary finance committee?
The letter was submitted by the Netherlands Online Gambling Association (VNLOK), VAN Kansspelen Brancheorganisatie, Dutch Lottery and Holland Casino Group.

What tax changes have been introduced in the Netherlands gambling sector?
The gross gaming revenue tax rate increased from 30.5 percent to 34.2 percent in 2025 and then to 37.8 percent in 2026.

Why do industry groups believe the tax increases may be problematic?
They argue that higher taxes reduce operator margins which may limit investment and make the regulated market less competitive.

What is meant by channelisation in gambling regulation?
Channelisation refers to the proportion of players who choose licensed and regulated gambling services rather than unlicensed platforms.

How might illegal gambling sites affect the Dutch market?
Unlicensed platforms operate outside the regulatory framework which can reduce consumer protections and limit tax revenue collection.

Has the land-based gambling sector been affected?
Industry data suggests that the number of physical venues has declined by around nine percent in recent years.

What role does the Dutch gambling regulator play?
The regulator oversees licensing, compliance and player protection within the legal gambling market.

What are the industry’s main requests to lawmakers?
They ask for careful monitoring of tax changes, timely review of results and consideration of the relationship between taxes and illegal gambling.

Will the government review the impact of the tax increases?
Officials have indicated that monitoring will take place and the results may inform future policy discussions.