Proposed twenty percent gambling tax threatens viability of licensed South African bookmakers according to industry leadership

CEO Sean Coleman warns that a proposed twenty percent tax would create an unsustainable burden for bookmakers and drive bettors to illegal offshore sites.

By: AXL Media

Published: Mar 4, 2026, 7:35 AM EST

Source: The information in this article was sourced from Malcolm Libera

Fiscal impact on licensed operators

Sean Coleman, the chief executive officer of the South African Bookmakers Association, has expressed significant concern regarding the sustainability of a proposed twenty percent gambling tax. According to his analysis, the headline figure is misleading when considered alongside existing obligations. Currently, bookmakers operate as VAT-able supplies, with approximately fifteen percent of every wager deemed to include value added tax. While operators can deduct certain business expenses, the net VAT paid to the national government typically sits between eleven and twelve percent of total revenue.

Cumulative tax burden calculations

In addition to federal VAT, licensed bookmakers are currently required to pay a provincial gambling tax of six point five percent to regional licensing authorities. When the effective VAT rate is combined with this provincial levy, businesses are already contributing roughly eighteen percent of their revenue to the state before the introduction of any new measures. The addition of the proposed twenty percent tax would effectively push the total fiscal burden to thirty nine percent, a level that Coleman describes as unsustainable for businesses already operating on thin profit margins.

Growth of the illegal gambling market

A primary concern for the industry is the potential for new taxes to inadvertently support illegal online gambling. Data provided by the association indicates that nearly three thousand illegal operators are currently targeting South African citizens. These entities typically hold licenses in foreign jurisdictions such as Malta, Curacao, or the Philippines, allowing them to bypass South African regulations and tax requirements. Coleman noted that an estimated sixty two percent of the total online gambling market in the country is already controlled by these offshore entities.