South African Court Rules Freeplay Credits Are Taxable Revenue

Provincial Boards Challenge Casino Revenue Reporting

The August 29, 2025 judgment addressed disputes involving two major casino operators who sought to exclude freeplay credits from adjusted gross revenue for taxation. Provincial gambling boards argued that all credited amounts, including non-cashable loyalty rewards, should be included in taxable revenue calculations. The case centered on statutory interpretation of provincial gambling acts rather than constitutional issues.

Justice Jody Kollapen emphasized the ruling’s focus on statutory interpretation affecting the specific parties involved. “The Court confirmed that freeplay credits are part of AGR, dismissed applications to exclude them and ordered the applicants to pay the respondents’ costs, including the costs of two counsel,” according to the Southern African Legal Information Institute. The Court noted the case “did not present issues of broader public or constitutional significance” though the ruling provides guidance for other casino operators.

Decision Establishes Industry Compliance Framework

The Constitutional Court ruling clarifies previously uncertain areas of South African gambling law regarding non-cashable loyalty credit treatment. The decision reduces potential disputes over revenue reporting while ensuring compliance with provincial regulations under the Western Cape Gambling and Racing Act and Eastern Cape Gambling Act. Casino operators now have a clear framework for handling non-cashable loyalty credits in revenue calculations.

The precedent-setting ruling could increase taxable revenue for both casinos and provincial governments. The judgment ensures casino operators accurately report revenue for taxation purposes across South Africa’s regulated gaming jurisdictions.