UCT academics endorse South Africa’s proposed 20 per cent gambling tax
They said betting activity has expanded sharply in recent years, particularly through online platforms.
South Africa.- Academics at the University of Cape Town have backed South Africa’s proposal for a new gambling tax, saying the country’s fast-growing online betting sector is increasing financial and social pressure on households.
The researchers expressed their support for the National Treasury’s plan to introduce a 20 per cent national tax on gross gambling revenue from online betting operators. The levy would be added to existing provincial gambling taxes, which currently range between 6 per cent and 9 per cent.
The proposal was first outlined in the Treasury’s draft discussion paper released in November 2025 as part of a wider review of online gambling regulation. The Treasury said the measure is intended to address rising gambling activity and its social costs rather than serve solely as a revenue tool.
The academics, Dr Nicole Vellios, Mxolisi Zondi and professor Corné van Walbeek from UCT’s Research Unit on the Economics of Excisable Products, said betting activity has expanded sharply in recent years, particularly through online platforms.
According to the researchers, online and retail betting volumes more than tripled between the 2021/22 and 2024/25 financial years, while total gambling spending more than doubled over the same period.
Their comments were published in Econ3x3, where they argued that the proposed tax should also cover retail betting operations to prevent gamblers from shifting from digital platforms to physical betting shops.
The researchers cited data from a 2025 Old Mutual survey showing that 52 per cent of South Africans earning more than R8,000 (€405) per month participate in gambling activities. The survey also found that three in four gamblers used online betting applications, while around 25 per cent reported financial difficulties linked to gambling.
South Africa’s gambling sector recorded an estimated R1.5trn (€76bn) in wagers during the 2024/25 financial year, according to figures referenced in the Treasury’s gambling tax discussion paper. Researchers said around 95 per cent of that amount was returned to players through payouts, leaving operators with about R74.5bn (€3.8bn) in gross gambling revenue.
The academics said gambling-related harm extends beyond player losses and can affect household finances, family stability and crime levels. They also raised concerns about aggressive marketing campaigns and the use of digital incentives encouraging continued betting after payouts.
Industry groups have opposed the proposal, arguing that higher taxes could push players towards unlicensed offshore operators. The South African Bookmakers’ Association said the combined burden of national, provincial and VAT-related taxes could significantly increase operating costs for licensed bookmakers.
The Treasury has extended the public consultation period on the draft proposal to allow additional industry submissions before a final decision is made.
