European Sports Betting Crisis Deepens as High Taxation and Regulatory Strains Drive Surge in Black Market Activity

High taxes in the UK and Netherlands are pushing bettors offshore. Read why LiveScore and kwiff CEOs believe European regulation is reaching a breaking point.

By: AXL Media

Published: Apr 22, 2026, 6:49 AM EDT

Source: Information for this report was sourced from iGB

Taxation Thresholds Igniting Rapid Black Market Growth

The European sports betting landscape is currently grappling with a fiscal phenomenon where government attempts to plug budgetary holes are inadvertently fueling illegal competition. iGaming consultant Henk Wolff notes that once taxation exceeds the 30% threshold, regulated operators lose their ability to compete with offshore entities that do not bear these costs. In the Netherlands, a series of tax increases—rising to 34.2% in 2025 and 37.8% this year—has led to a dramatic drop in onshore Gross Gaming Revenue (GGR). Experts argue that policymakers often ignore the mathematical reality that capital is mobile, and players will naturally seek better returns in the unregulated sector when onshore margins are squeezed.

LiveScore Bet Exit Highlights Dutch Market Instability

The withdrawal of LiveScore Bet from the Netherlands in late 2024 serves as a primary case study for the region's regulatory challenges. CEO Sam Sadi explained that despite having a significant existing user base, the combination of strict reporting mandates and effective tax rates approaching 50% made profitability a decade-long prospect. Since the implementation of these measures, channelization in the Dutch market has plummeted from nearly 90% to approximately 60%. Sadi emphasized that the decision to exit was a formulaic investment choice, as the company’s finite capital could achieve significantly faster returns in more stable environments.

Ideological Shifts and the Decline of UK Market Leadership

The UK, traditionally a global leader in liberalized gambling economics, is now perceived by some industry veterans as becoming hostile to the sector. Following the rise of Remote Gaming Duty to 40% on 1 April, Sadi described the move as an "ideological signal" that the government no longer prioritizes the success of regulated companies. This shift has led to major entities like Flutter pivoting their primary focus toward the American market. Legitimate operators now operate with a severe handicap, maintaining margins of 30-35% while offshore competitors enjoy roughly 90% margins due to their lack of tax and regulatory compliance.