Key Moments:
- Six key European gambling markets have enacted major tax reforms in 2025, aiming for more than €520 million in additional yearly revenue.
- Early data from the Netherlands shows a 25% drop in gross gaming revenue and tax receipts falling to 83% of previous levels despite higher tax rates.
- Germany’s 5.3% turnover tax has led to only 20-40% of slot play occurring on licensed sites, shifting most players offshore.
Coordinated Tax Reforms Sweep Across Europe
A wave of gambling tax hikes has rolled across six significant European markets, positioning governments to maximize revenue collection from industry operators. Although governments expect over €520 million in fresh annual proceeds, early reports suggest that higher taxes can undermine their aims if market dynamics are not carefully considered. Markets such as Portugal, the Netherlands, and Germany are each encountering distinct challenges as their new tax frameworks meet real-world operator behavior and consumer preferences.
Portugal Turns Casino Licensing into a Revenue Engine
Portugal experienced robust growth, with gaming revenue rising to €287 million and posting 9.6% year-on-year growth for the second quarter. The government has shifted casino licensing toward a high-cost, GGR-focused tender process. In the regions of Algarve, Espinho, and Póvoa de Varzim, bidding on new 15-year casino concessions requires upfront fees from €31 million to €36 million, plus heavy GGR-linked variable fees running 30-35%—all atop existing taxation as high as 35% of GGR in certain locations.
Applicants face minimum fixed annual contributions of €1.5 million, yet the tender system emphasizes revenue share and fixed fees over operational or technical plans. As a result, established incumbents have a significant advantage while innovation is stifled. The sector’s growth—helped by tourism and the certainty of long-term licenses—has not allayed concerns about the sustainability of these high barriers, especially as Portugal’s 30 licensed online operators generated €284.7 million revenue in Q1 2025 alone with €95.5 million in taxes paid during the quarter.
| Casino Region | Upfront License Fee (€ millions) | Annual Fixed Contribution (€ millions) | Variable GGR Fee (%) |
|---|---|---|---|
| Algarve | 31 | 1.5 (minimum) | 30-35 |
| Espinho | 36 | 1.5 (minimum) | 30-35 |
| Póvoa de Varzim | 33.7 | 1.5 (minimum) | 30-35 |
Dutch Tax Increases Trigger Lower Revenue
The Netherlands advanced toward a 37.8% gambling tax target for 2026 after raising its rate from 30.5% to 34.2% in 2025. Contrary to ministry projections of an extra €200 million, gross gaming revenue fell by 25% and tax receipts dropped to only 83% of the prior year’s level within the first six months. Increasing tax rates, coupled with tighter advertising controls and player deposit limits, has driven channelisation down, with estimates showing that only 50% of gambling occurs on licensed platforms.
Further pressure looms as all operators must reapply for five-year licenses in 2026, now requiring detailed wind-down plans if their licenses are not renewed. Enhanced anti-money laundering scrutiny presents additional challenges, especially for those with regulatory breaches on record. Some industry participants now question whether the regulated Dutch market remains commercially viable. Holland Casino’s own staff have protested these conditions, highlighting risks to the state operator’s sustainability.
Germany’s Turnover Tax Drives Players Offshore
Germany’s distinctive policy taxes every euro wagered, not just gambling profits, imposing a 5.3% levy on online slots and poker. With the effective GGR tax rate for slots vaulting above 25%, the regulated market has seen only 20-40% of slot play stay licensed—the rest has shifted to black market sites not subject to the tax. Slot players have departed in large numbers, with German online casino tax revenues sliding by 16% for 2024, and a cumulative 47% decline since 2022.
The 5.3% turnover tax—designed to align with the existing 5% sports betting tax—remains politically entrenched, even as industry groups push for a move to GGR-based taxation. While legal sports betting achieves 60-70% channelisation thanks to different product restrictions and a lower levy, casino operators face acute viability challenges. The government’s own OASIS exclusion system has seen record rises, indicating a migration of consumers away from licensed products rather than away from gambling itself.
Other Markets: Tax Increases, Political Deadlock, and Market Growth
In the Czech Republic, a tax hike from 23% to 30% GGR took effect January 1, 2024, with online slots retaining a 35% rate. Accompanying this were dozens of new consumer-protection measures, stricter bonus offers, and tougher AML requirements. Despite the compounded costs, government forecasts anticipate continued gambling market growth, with the single indefinite-term base licenses and easier entry for EU operators designed to offset the regulatory load.
Slovakia’s plan to harmonize online and land-based gambling taxes at 30% GGR has hit political turbulence. The Finance Ministry’s proposal is stuck amid disputes over whether brick-and-mortar casinos should pay higher rates due to perceived social harm. As debates continue, the Gambling Regulatory Authority has warned lawmakers that high tax rates could push players toward illegal venues. The market itself is growing fast, with GGR at €1.45 billion in 2024—a 9% year-on-year rise—yet operators remain in limbo as negotiations drag on.
Bulgaria, meanwhile, has paired a jump from 15% to 20% GGR tax with tripled license fees and new structural changes. Online operators are thriving, with GGR up more than 30% year-on-year, even as lottery and betting taxes sagged by 11% for January-September 2024 due to adjustments in how taxes are structured. Despite fierce industry opposition, casino tax receipts rose by 41% after a 60% hike in retail levies, and online expansion appears unaffected by higher rates.
Racing and betting operators need radical change to stabilise their relationship. Scrap levy & media rights, replace with a Universal Gambling Levy of 3–4% on all betting & online gaming GGY. Operators pay once, racing gets £300–400m, margins align with sports.
— Chris Fawcett (@chrisgambler247) September 9, 2025
Wider European Directions and Industry Warnings
Elsewhere, France examines online casino legalization with an eye toward new revenue streams, Italy balances responsible gambling measures with fiscal review, Spain tightens advertising and deposit rules, and Sweden intensifies enforcement against unlicensed operators. These approaches signal that gambling tax policy is just one facet of broader governmental efforts to extract value from this growing sector.
Across all reformed jurisdictions, industry voices warn that aggressive tax policy may cause the opposite of intended fiscal results. The Dutch and German examples document declining receipts and player migration to unlicensed offerings, confirming that excessive taxes may reduce both public revenue and regulatory oversight. The Slovak regulator and industry associations in multiple markets have echoed similar concerns—that channelisation suffers when taxes push consumers abroad.
Europe’s gambling regulation experience in 2025 demonstrates that sustainable taxation requires a careful balance: generating revenue while keeping markets competitive and players within the regulated realm. Governments aiming for short-term fiscal gains at the cost of long-term channelisation and player protection may ultimately undermine their own objectives.
- Author
Daniel Williams
