Dutch Budget confirms gambling income tax hike to 37.8% by 2026

The Netherlands’ new Conservative Coalition government has confirmed that it will apply a two-step approach to raising income taxes generated by gambling businesses.

This afternoon, following the customary processions of Prinsjesdag (Prince’s Day), Netherlands Finance Minister Eelco Heinen and Prime Minister Dick Schoof presented the Budget 2025 to the Kamer.

As anticipated, the Budget confirmed that the Coalition will increase income taxes on gambling businesses from 30.5% to 37.8%.

However, the Ministry of Finance will implement its income tax hike in two steps, applying an increase to 34.2% in 2025 and 37.8% in 2026. The two-tiered approach considers “industry adjustments” to allow gambling businesses time to stabilize their accounts under the new tax system.

The Budget’s text reads: “This government regards healthy public finances as crucial and will be implementing a number of measures set out in the framework coalition agreement, as well as additional measures to absorb financial setbacks. As such, the Budget will increase the tax on games of chance in two steps, to 34.2% in 2025 and 37.8% in 2026.”

The steep income tax increase applied to gambling businesses will see the Dutch government discontinue its tax on customer winnings of more than €449 from a lottery or casino in the Netherlands.

Prior to the Budget, the Coalition, formed by the conservative quartet of the Freedom Party, VVD, NSC, and the Farmers Movement, had previously warned the gambling sector of “structural increased tax measures” in its ‘governing mandate’.

In anticipation of the Budget, Nederlandse Loterij urged the Coalition to recognize lottery income as ‘soft gambling’, which should be exempt from tax hikes.

The Dutch National Lottery expressed concerns that the tax increase would hinder its direct funding of sports programs of the Netherlands Olympic Committee (NOC), leading to concerns about funding for professional and amateur sports in the country.

Nederlandse Loterij has demanded that a “specific differentiation” be added to the tax code for distinguishing income generated from high-risk (casino and slots) and low-risk (lotteries) gambling for tax purposes.

The tax increase will likely force Holland Casino into reorganisation, as the state-owned firm will struggle to offset the increased tax burden, in which it  will need to generate an extra €100 million to avoid losses. To cut costs, Holland Casino will reduce operating hours at its locations in Rotterdam and Amsterdam starting in 2025 and may close additional branches.

Further consequences saw Flutter Entertainment announce the withdrawal of its Tombola.nl brand from the Dutch market, citing that the tax hike and upcoming deposit limits made the terms of the Remote Gaming Act (KOA Act) no longer applicable for operating its bingo brand.

The gambling trade bodies of NOGA (online gambling) and VNLOK (land-based) responded to SBC, stating it is reacting with great concern to the government’s intention to increase the gambling tax from 30.5%, via 34.2% in 2025, to ultimately 37.8% in 2026.

Eric Konings, Interim General Secretary of NOGA, stated: “In view of the phased introduction, the government shows some recognition of the risks of counterproductive effects on gambling policy objectives and the public purse, but this does not allay concerns about the continued existence of regulated gambling offerings. This underlines the need to map the effects of the gambling tax, in conjunction with other announced policy changes, ongoing evaluations, and previous parliamentary decisions, more fundamentally and carefully.

All the facts and figures indicate that the tax increase will lead to further depletion of the regulated supply. As a result, tax revenues will fall. At the same time, an increase in illegal and therefore riskier gambling is expected. This will harm the general policy objectives of Dutch gambling policy, which focus on consumer protection and the prevention of fraud, crime, and gambling addiction. If this is abandoned, social costs will rise, leading to additional financial setbacks.”

Starting from October 1, new mandatory deposit limits and customer care responsibilities will be enforced for online gambling licenses of the KOA market. These new online regulations require operators to perform mandatory checks on monthly deposit limits of €350 for player accounts aged 25 and over. For accounts of players under 25, operators must ensure deposit checks are limited to €150 per month.

The next phase of KOA market reforms will be led by the new Legal Protections Minister, Teun Struycken, who will evaluate all proposals to modify and overhaul the KOA Act. This includes considerations for a complete ban on gambling advertising and the implementation of a universal loss limit for operators.

The ongoing tightening of KOA compliance measures has led several international operators to place their Dutch market activities under strategic review, citing unsatisfactory growth since the market’s launch on October 1, 2021.

Konings warned: “The members of NOGA, VAN Kansspelen and VNLOK call on the government to bring the financial targets in line with the gambling policy, and to discuss this with the parties involved. In this context, the social importance of the safe and regulated range of games of chance on the one hand and the income for the state treasury on the other hand will have to be balanced with each other.

For these purposes, it is essential that the proper exploitation of legal supply remains possible, and it is precisely this that will come under serious further pressure as a result of the proposed tax increase.