KZN Eyes Online Gambling Tax as a New Source of Provincial Income

KwaZulu-Natal Finance MEC, Francois Rodgers, has urged the province to tap into new revenue sources, including the taxation of online gaming and betting, to reduce reliance on national government funding.

Speaking at Sanlam’s post-budget event in Durban on Wednesday, Rodgers stressed the importance of finding alternative income streams, highlighting that local revenue accounts for just 2.7% of the provincial budget, while over 80% comes from national allocations.

“There’s a growing online gaming and gambling sector that is impacting traditional casinos and horse racing, yet it remains untaxed. That must change,” Rodgers stated.

He called for legislative reforms to regulate online gaming and allow the province to collect tax revenue from digital betting platforms. “We need Parliament to pass a bill on online gaming so that any gambling taking place in KwaZulu-Natal can be taxed. This is a massive untapped revenue source,” he added.

Picture: Learn Bonds

KwaZulu-Natal has been under financial strain, particularly after experiencing budget cuts exceeding R60 billion over the past four years.

In addition to online gambling taxation, Rodgers proposed overhauling the liquor license tax system. He argued that the current flat-fee model is outdated and unfair, suggesting a volume-based tax that considers the size and sales of liquor businesses.

“For years, liquor licenses have operated on a flat fee. That makes no sense. A small bottle store cannot be taxed the same as a major corporate retailer. We need to shift to a system that taxes alcohol sales based on volume,” he explained.

Despite the province’s fiscal struggles, Rodgers expressed confidence in recovery efforts. He highlighted ongoing reforms, including the implementation of an e-procurement system designed to curb wasteful spending and improve transparency.

“We’ve invested R12 million into the e-procurement system to ensure more efficient government spending. This tool will help prevent unnecessary expenses and ensure taxpayer funds are used wisely,” Rodgers concluded.

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Sourced:IOL