Is this an argument for banning offshore software?

No. Several international suppliers are excellent and competition is good for bettors. The argument is that South African companies should be able to compete for this work, and at present few are in the running.

Does offshore software mean gambling taxes leave South Africa?

No. Provincial gambling taxes are paid by the licensed bookmaker here whatever software it runs. What leaves is the technology fee: the platform licence, the revenue share, the per-check charge, the data feed. That is an import of services, not avoided tax, and conflating the two makes the argument easy to dismiss.

South African technology

Why should South Africa only be a market?

South Africans place the bets. South African bookmakers hold the licences and pay the provincial taxes. Most of the technology the bets run through is built, licensed, tested and invoiced somewhere else.

Where the fee goes

A single bet touches a stack of software. Each layer is a commercial relationship with a supplier, and most of those suppliers are not South African. Each fee recurs for as long as the bookmaker trades.

01 Sportsbook and platform software Prices the markets, settles the bets, runs the wallet, holds the account. Usually licensed from an offshore vendor on revenue share.
02 Odds, data and virtual products Live pricing, scores, streaming rights and generated products, bought from a small number of global suppliers.
03 Payments Acquiring, gateways and settlement, each hop priced, several of them in a foreign currency.
04 Identity and verification KYC, age assurance and fraud scoring, charged per check to an overseas provider.
05 Testing and certification A specialised conformity-assessment layer in which South Africa has limited independent local choice. SASFA is being established to add capability.

Be precise about the money

Gambling taxes and levies are paid here, by the licensed bookmaker, whatever software it runs. What leaves is the technology and service fee, converted and sent out every month for the life of the business. That is an economic-participation question, not a tax scandal, and an organisation that publishes test results cannot afford to be loose with a number when it suits the argument.

What stays when it is built and tested here

The margin. A licence fee paid to a Cape Town company is revenue in Cape Town.
The intellectual property, and the ability to sell it into other markets.
The skills. Platform, payments and high-volume transactional engineering transfer far beyond betting.
The ability to audit. Software built and tested here can be examined here.

What has to change

Local suppliers need a clear route from “we have built it” to a defined test report, certification submission and provincial approval. South Africa has the standard and a statutory route for qualified testing agents. SASFA is being established to meet that route.

South African software
Tested in South Africa
South African bookmaker
South African bettor

If you build or regulate any layer of this stack, discuss the intended laboratory scope with SASFA.