Finance Minister Enoch Godongwana announced that the National Treasury is developing a National Online Gambling Tax, with specific details to be provided in 2027.
No introduction of new general taxes or alterations to the existing tax or VAT system were discussed.
During the Medium Term Budget Policy Statement (MTBPS), Godongwana noted that many submissions were received regarding the proposed online gambling tax.
These submissions “generally recognised the need to address the growth of online gambling and its associated harm.”
The Treasury indicated that, given the rise in online gambling and its societal impacts, a 20% tax on gross gambling revenue from online betting is proposed.
This would include interactive gambling, adding to the provincial taxes already in place.
Over the years, the gambling sector has shifted significantly from traditional methods to an increased reliance on online platforms.
This transition has been spurred by technological progress and broader internet accessibility.
Online gambling is now readily available, allowing participation nearly anywhere and at any time.
Reports indicate that South African gamblers spent R1.5 trillion during the 2024/25 period. This figure represents total gambling turnover and does not include payouts or winnings.
This is reflected in gross gambling revenue (GGR), which, though smaller, is also on a rapid growth trajectory.
Data from the South African Reserve Bank shows GGR increasing from R26.3 billion in 2015 to R74.5 billion in 2024.
However, the expansion of sports betting and various digital services that circumvent existing limitations poses a considerable challenge in the nation.
This situation underlines the necessity for a specific tax framework.
Godongwana mentioned that discussions about the proposed tax are progressing, particularly concerning its design and relationship to current regulations.
The Treasury will also explore the tax’s effects on provinces and the regulated market.
“An announcement of the final design will be made in the February 2027 Budget,” the minister confirmed.
No other tax measures mentioned
Typically, the MTBPS does not focus on revenue generation, and announcements of new tax measures are rare.
Nevertheless, the speech often signals potential tax adjustments for the upcoming 2027 Budget Speech.
For instance, Godongwana indicated during the 2025 MTBPS that if tax collections fell short in 2026, approximately R20 billion in tax measures would be needed.
Fortunately for taxpayers, sufficient collections in the 2025/26 period allowed the Treasury to avoid necessary tax increases and even grant some tax relief in the subsequent 2026 Budget Speech.
In the 2026 MTBPS, aside from the work on the gambling tax, Godongwana did not suggest any tax deficits that would require new measures for 2027.
In fact, the Finance Minister indicated that revenue estimates for 2026/27 are better than initially projected due to increased collections from corporate taxes, dividends tax, and VAT.
“As a result, gross tax revenue for this year has been revised upwards by R17.1 billion compared with the February estimate,” he stated.
A significant part of this revenue growth is attributed to higher commodity prices, though such gains are anticipated to taper off over the medium term.
Regardless, overall gross tax revenue is forecasted to rise from R2.14 trillion this year to R2.53 trillion by 2029/30.
With the upward revision of revenue collections, no modifications to the general tax or VAT system were mentioned.
