NOGA: Dutch gambling tax increase should form no part of Coalition talks

Dutch Online Gambling Association (NOGA) has cited ‘great concerns’ on gambling tax increases being adopted as part of ongoing negotiations to form a new coalition government.

On Wednesday, the quartet of parties who are in ongoing discussion to form a majority government submitted their agreed ‘budgetary appendix’ to the House of Representatives.

Led by Geert Wilders, the Party for Freedom (PVV) spearheads the discussions to form a new conservative coalition government with the Party for Freedom and Democracy (VVD), the New Social Contract party (NSC), and the Farmer-Citizen Movement (BBB).

The appendix on taxation, expenditures, public investment, and subsidies detailed a planned increase in gambling taxes from 30.5% to 37.8%.

General Director Peter-Paul de Goeij of NOGA voiced serious concerns over this proposed tax hike, stating, “The proposed increase in the tax rate by no less than 7.3% endangers the viability of the legal Dutch gambling market.”

He highlighted that recent reports from the Gaming Authority already show that channelisation is under pressure, the growth of the gambling market is levelling off, and this growth is also lagging behind other European countries.

NOGA argues that the increased tax burden will lead to a further decline in the legal gambling supply, pushing consumers towards illegal providers. De Goeij emphasised the risks, noting, “This is extremely risky, knowing that illegal parties do not pay taxes and are not bound to the duty of care as prescribed in Dutch legislation and regulations, are already ostentatiously luring for the business of Dutch consumers.”

The association warns that the intended budgetary gain of €200 million from the tax increase will be offset by significant social damage. “NOGA fears that the intended budgetary gain from this tax increase of €200 million will be in stark contrast to the significant social damage that will occur because Dutch consumers will increasingly resort to illegal providers, who do not pay taxes and therefore much more strict can compete for the favour of the Dutch player,” de Goeij stated.

Market realities detail that Illegal gambling providers are not being subject to taxes or Dutch regulations, can offer more competitive odds and promotions, drawing consumers away from legal operators – “These providers will experience the benefits of decanalisation, but the financial and emotional burdens, for example because no action is taken in problematic gaming behaviour, will be passed on to the Dutch taxpayer,” de Goeij warned.

NOGA’s concerns reflect the broader implications of the tax increase, stressing the need for a balanced approach that ensures the sustainability of the legal gambling market while protecting consumers from the harms of illegal gambling activities. As the coalition negotiations continue, it remains to be seen how these issues will be addressed in the final budgetary plans.