South Africa defers final decision on 20% online gambling tax to February 2027 Budget

South Africa's government has pushed back its final decision on a proposed national tax on online gambling until the February 2027 Budget. Finance Minister Enoch Godongwana gave the update on 21 October during the Medium-Term Budget Policy Statement.

The proposal, first published by National Treasury in November 2025, would introduce a 20% levy on gross gambling revenue from online betting and interactive gambling. Godongwana said consultations are continuing on the tax design, its links to the existing regulatory framework, and the implications for provinces and the currently regulated market. He said the final design would be announced in February, according to a Daily Investor report.

Treasury has previously estimated that the levy could raise more than R10bn a year for the national government. Officials have argued, however, that revenue is not the main aim. Christopher Axelson said Treasury sees the measure as closer to a sin tax, although it would not work on a per-unit basis like alcohol or tobacco duties, since companies would be taxed directly. He added that Treasury would welcome a fall in online gambling resulting from the tax, even if that reduced revenue.

The plan has drawn strong criticism since it was released for consultation. Treasury first accepted public submissions until 30 January 2026, then extended the deadline to 27 February after stakeholders asked for more time. Godongwana noted that the consultation has generally shown support for tackling the rapid growth of online gambling.

A central objection is that operators already pay provincial taxes, with online betting rates averaging around 6% to 7% depending on the province. The national levy would be added on top of these charges rather than replace them. Opponents argue that this could make licensed operators less competitive and push players towards offshore platforms.

Earlier this year, the Free Market Foundation called the proposal a naked revenue grab that threatens the existence of the legal gambling market. It also questioned whether the plan fits South Africa's constitutional and regulatory framework, which gives provinces a leading role in gambling regulation. Despite the pushback, Treasury is keeping the proposal on the table while talks on its structure continue.