Could the UK's gambling tax rises end up like the Netherlands' disappointing results?

Just months after the UK introduced one of the biggest increases in gambling duties in recent years, new figures from the Netherlands suggest governments may not always receive the tax windfall they expect.

Dutch authorities found gambling tax increases generated only a fraction of the additional revenue originally forecast after tighter regulation and lower gambling activity reduced the taxable market. The UK's gambling sector differs significantly, but these findings may offer an early indication of potential challenges if we expect higher gambling taxes to deliver substantial increases in Treasury receipts.

Dutch tax rises fall well short of expectations

The Netherlands introduced its gambling tax increase in two stages. The rate rose from 30.5% to 34.2% in January 2025. It increased again to 37.8% at the start of 2026.

The Dutch Treasury had forecast that the changes would generate around €108 million in additional revenue during 2025 and a further €216 million in 2026.

Instead, the report estimates the increases generated only around €2 million of additional revenue in 2025. In 2026, it was approximately €57 million in 2026 compared with 2024.

According to the report, the shortfall was largely caused by a shrinking tax base. Gambling tax is calculated using gross gaming revenue (GGR), meaning lower gambling activity directly reduces tax receipts.

Why did revenues fall short?

The report points to several factors that reduced gambling revenue over the past two years:

• New player protection rules introduced monthly net deposit limits of €300 for younger adults and €700 for players aged 24 and over.
• Restrictions on gambling advertising also expanded, with television sponsorship ending in 2024 before sports sponsorship bans came into force during 2025.
• The boost in betting activity seen during UEFA Euro 2024 faded.
• Continued regulatory changes created additional uncertainty across the market.

Several land-based operators also closed venues or restructured parts of their businesses. Some cited higher gambling taxes as one factor affecting profitability.

The KSA's latest annual report also suggested licensed operators lost market share during the same period.

State operators also felt the impact

The report found that two state-backed gambling businesses also experienced significant financial pressure.

Holland Casino's profits before corporation tax fell by around €27 million during 2025. Losses are expected to reach approximately €54 million in 2026.

Meanwhile, Nederlandse Loterij projected reductions in profits, corporation tax payments and statutory levies of around €16 million in 2025 and approximately €34 million in 2026.

Casino and gaming hall visits also declined by around 11% between the first quarter of 2025 and the first quarter of 2026. The number of gaming halls also continued to fall.

However, contributions made by licensed operators to charities and sporting organisations remained broadly stable. Charitable donations also rose slightly despite the tax changes.

Could the UK face similar challenges?

The Dutch experience shows the challenge governments face when trying to increase tax revenues from a heavily regulated gambling market.

Higher taxes can generate additional income if gambling activity remains stable. However, when tax increases coincide with stricter affordability measures, advertising restrictions and lower consumer spending, the taxable market itself may contract.

For the UK, the findings are an interesting case study rather than a direct comparison. Britain's gambling market differs in both size and structure. Any future changes would be shaped by domestic policy decisions.

Nevertheless, the Dutch figures are likely to add to the debate over whether increasing gambling taxes alone is enough to deliver the revenue governments expect, particularly if wider regulatory reforms also reduce overall gambling activity.

Summary