Back-to-back gambling tax increases in the Netherlands have generated a fraction of the revenue the government projected, according to a joint report by the Ministry of Finance and gambling regulator Kansspelautoriteit (KSA).
The report states that the objective of generating additional gambling tax revenue by raising rates “is not being achieved as expected.” The admission is significant: the Dutch government pressed ahead with two consecutive increases despite sustained industry warnings about the consequences for the legal market.
How far off are the numbers?
The gap between forecast and reality is wide. The government raised the gambling tax rate from 30.5% to 34.2% in 2025, projecting an additional €108m in tax receipts for the year. The actual increase was €2m.
For 2026, the rate rose again to 37.8%, with a projected additional yield of €216m. The actual additional revenue collected stands at €57m — roughly a quarter of what was forecast.
A further complication the report identifies is a decline in income from state-owned gambling operators, which means “the additional revenue for the government is even lower” than the headline shortfall suggests.
Holland Casino and the legal market squeeze
Holland Casino has been among the most vocal critics of the tax trajectory. The state-owned operator returned to profit in Q1 2026 but attributed the improvement primarily to cost-cutting rather than revenue growth — a telling signal about how the rate increases are landing at the operator level.
The pattern is consistent with what operators and industry groups have argued throughout the rate-setting process: that above a certain threshold, tax increases reduce taxable activity rather than expanding the state’s take. The Ministry of Finance and KSA report appears to confirm that threshold has been crossed, though neither body has stated publicly what the correct rate should be.
The Dutch government’s approach to gambling taxation is not unique in Europe. Several markets have pursued higher rates in recent years, with mixed results. An EU-level proposal for a harmonised iGaming tax framework has gained momentum in Brussels, raising broader questions about how member states price their regulated markets.
Advertising restrictions and the parallel debate
The tax findings arrive alongside a separate regulatory push. The Dutch government recently announced plans for a blanket ban on gambling advertising — an extension of restrictions already in place. The proposal would go further than current rules, which already limit where and how operators can advertise.
The interaction between advertising bans and market channelisation is a recurring policy tension in regulated markets. Denmark faces a similar debate, with an advertising ban looming over a market where online casino continues to lead. Restricting advertising tends to reduce the visibility of licensed operators relative to unlicensed alternatives, which are not subject to the same constraints.
The illegal market dimension
Running alongside the tax and advertising debates is the unregulated sector. Dutch gaming trade association VNLOK announced this week it is suing Meta — and involving the European Commission — over illegal gambling advertising on Facebook and Instagram. The action targets the platforms that host the ads, rather than the operators running them, and brings Brussels into a domestic enforcement dispute.
The illegal market is not a peripheral concern in the Netherlands. If higher taxes and stricter advertising rules push licensed players toward unlicensed alternatives, the state’s net position deteriorates further: it collects less tax from the regulated sector while enforcement costs rise. Global estimates put unregulated online gambling at $5.9tn in 2025, a scale that makes domestic crackdowns difficult to sustain without coordinated action at the platform and payment level.
The Ministry of Finance and KSA report does not set out a revised tax path. What it does is put a number on the distance between forecast and outcome, and acknowledge that the current approach is not delivering what was modelled. Whether that prompts a rate adjustment, a recalibration of the advertising policy, or a continuation of the existing trajectory is a decision that now sits squarely with the Dutch government.
Source: Kansspelautoriteit (KSA) / Dutch Ministry of Finance
