Proposed 20% gambling tax could push South Africa’s licensed bookmakers to the brink, warns SABA. CEO Sean Coleman says the move may fuel illegal online gambling rather than increase revenue. Picture Credit: YogoNet
By Aisha Zardad
South Africa – The South African Bookmakers Association (SABA) has warned that a proposed 20% gambling tax could threaten the survival of many licensed operators already running on very tight margins.
Sean Coleman, CEO of SABA, said the industry believes the new levy is counterproductive, likely to encourage illegal online gambling rather than increase government revenue.
“This proposal will not deter vulnerable consumers from gambling — it will push them to unregulated platforms,” Coleman said.
He also warned that the advertised 20% tax is misleading, as when combined with existing levies, licensed bookmakers could face a total tax burden of nearly 39%.
“15% of every R100 bet is deemed to include VAT, which is paid over to the government,” Coleman explained. Licensed operators also pay a provincial gambling tax, currently set at 6.5%. After factoring in effective VAT, the total tax currently sits around 18%. The addition of the proposed 20% levy would push this closer to 39%.
Illegal Gambling Could Accelerate: Coleman warned that the new tax could worsen the very problem it seeks to address.
“Many operators are already working on narrow margins. This additional tax could be the final nail in the coffin for some businesses,” he said.
He highlighted the risk of driving gamblers toward illegal offshore operators. According to Coleman, around 2,884 illegal platforms are actively targeting South African consumers, many licensed in jurisdictions such as the Philippines, Malta, and Curaçao.
A 2024 study estimated that illegal operators now account for roughly 62% of South Africa’s online gambling market, with more than R50 billion flowing offshore.
Focus on Enforcement, Not Higher Taxes: Instead of taxing compliant businesses further, Coleman urged government to strengthen enforcement against illegal gambling.
“Let’s close that border as much as we’re looking at our physical border. Let’s get that money rechannelled back into our existing economy,” he said.
The association is calling for a dedicated task team, bringing together regulators, industry stakeholders, and bodies such as the communications regulator and National Gambling Board. Public education is also part of the plan, helping consumers identify legal platforms by checking for South African gambling board licences on websites.
Coleman also noted that winnings from illegal sites can be confiscated under existing law, and the industry is working with banks to block payments to illegal operators.
“Shutting down the illegal market should come first, before imposing additional taxes on businesses that are already compliant,” he said.
