FMF urges South Africa’s Treasury to drop proposed 20% national online gambling tax

The Free Market Foundation says the draft levy is unenforceable against offshore sites, constitutionally risky, and could weaken the licensed market by pushing more play to unregulated platforms.

South Africa’s Free Market Foundation (FMF) has formally asked National Treasury to withdraw its draft proposal for a 20% national online gambling tax applied to gross gambling revenue (GGR) from online betting and interactive gambling.

Treasury’s discussion paper argues that the online shift has increased social harms and that a national tax could help “internalise” those costs and reduce distortions created by different provincial gambling tax rates. The paper proposes a 20% levy on GGR on top of existing provincial taxes, estimating an effective combined burden of about 26%–29% and stating the measure could raise over R10 billion at current GGR levels.

In its submission, the FMF says the plan assumes government can tax offshore online casinos despite “the absence of any mechanism or enforcement infrastructure,” calling that assumption “fundamentally flawed.”

The FMF also argues that what Treasury frames as “harmonisation” amounts to fiscal centralisation that undermines provincial gambling boards’ primary role in licensing, compliance and taxation, raising “serious constitutional questions” about eroding jurisdictional boundaries.

Finally, the Foundation warns the extra national layer could destabilise compliant operators and drive users to offshore platforms, noting “industry research” suggesting offshore online casinos already account for roughly 62% of online gambling activity.

Treasury has extended the public comment deadline to 27 February 2026, after initially setting it for late January.