South Africa's gambling industry is facing one of the heaviest tax increases in its history.
In November 2025, the National Treasury released a 24-page discussion paper proposing a new online betting levy of 20% on gross gambling revenues. If implemented, the government says the measure will reduce problem gambling and more than double tax receipts from the sector, increasing it from the current R4.8 billion to R10 billion annually.
While public consultation on the proposed tax ends in February 2026, a draft bill is expected to be tabled in Parliament later this year, with a final proposal possibly coming in February 2027. But before lawmakers draft the bill, it is worth understanding what prompted the Treasury to act in the first place.
A market that's growing too fast to ignore
South Africa's online gambling market has been growing significantly over the past few years. In the 2024/2025 financial year, SA players are expected to wager R1.5 trillion, a massive 31.3% increase on the previous year. South Africa's National Gambling Board attributes this huge growth to faster internet speeds, increasing smartphone betting and 24/7 availability.
Furthermore, online gambling alone contributes approximately 75% of betting revenues, confirming that this activity previously limited to physical establishments has moved decisively online.
Consumer preferences also reflect this change. Players are increasingly looking for platforms that offer quick ZAR-friendly transactions, generous bonuses and a variety of games. Features that see through South African casinos you can find on Casino.com. This rapid growth in online gambling and betting activity has outpaced SA's policy and regulatory framework.
The current tax model allows provincial gambling boards to license and tax online bookmakers and their land-based counterparts. Interactive gambling, including online casino-style games, remains illegal 2008 National Gambling Amendment Act, The intention to regulate this sector was never put into operation.
As a result, South Africa's complex gambling regulations, coupled with its varying provincial tax rates, have created an environment where legislation struggles to keep pace with the social costs of digital gaming.
Proposed national levy targets regulatory gaps
With a patchwork of provincial oversight and outdated legislation, SA's growing online gambling market has largely outstripped the regulations designed to regulate it. However, the Treasury's proposed levy seeks to change this.
The government recommends imposing a 20% national tax on gross gambling revenues from both online betting and interactive gambling. Notably, this proposal extends to interactive gambling, even where it is technically illegal, with a tacit recognition that the activity is taking place regardless of its legal status.
On the compliance side, the discussion paper suggests that local online betting operators register with the South African Revenue Service (SARS) using the same information already submitted to provincial gambling boards for provincial tax purposes. In this way, the government will effectively levy the proposed tax on gross gambling revenues generated exclusively by online betting and interactive gambling services.
This proposal represents the most coordinated effort yet to align South Africa's fragmented online gambling tax framework with the realities of a market that has grown far beyond what existing law requires. But whether the numbers matter to operators and consumers alike is a different question. One thing the industry is already demanding loudly.
“A naked revenue grab,” say industry critics.
Betting companies and other stakeholders are lobbying hard against the proposed national tax, arguing it would cause more harm than good. Instead of curbing gambling, they say it would hand over market share to unregulated operators, ultimately reducing the revenue collected by the government.
The Free Market Foundation, in particular, called the new national levy “Naked revenue grab that threatens the existence of the legal gambling market.“It also suggests that the move would be unconstitutional. Under its detailed submission, the organization says that imposing a national tax on an activity currently governed by a provincial licensing framework amounts to centralization of power. This, in turn, cuts against the country's established separation of regulatory authority.
The numbers add fuel to that argument. Licensed SA operators already pay VAT and provincial gambling fees of between 6% and 9% depending on the province and proposed venue. Stacking the proposed 20% levy would effectively bring the combined tax rate to 26%-29%. Such figures, according to critics, could make licensed operators uncompetitive against offshore platforms that pay no South African tax at all.
Research cited by South African Bookmakers Association (SABA) CEO Sean Coleman revealed that more than 2,084 unregulated bookmakers targeted SA players in the 2024/2025 period alone. Furthermore, 27% of South Africans interacted with illegal gambling platforms during the same period, giving such operators 62% of all online gambling activity in the country.
revenue regulation issue
The argument taking hold among industry voices is simple: Taxing a broken market won't fix it. The 27% of South Africans who gambled on illegal platforms in 2024/2025 were not deterred by existing regulations, and increasing compliance costs for licensed operators will not change this. If anything, it makes the unregulated option more attractive.
Critics argue that the more serious problem is enforcement. Illegal platforms operate without any consumer protections. Rather than imposing higher taxes on operators who are already compliant, a more logical starting point is to bring this activity into a properly regulated framework. As a result, once the market is properly organized the question of revenue largely resolves itself.