This, says a Business Day report, could mean the government has to pay about R500m it unlawfully denied to racing companies.
The provincial government must now restore the levy, benefiting the local industry and possibly other operators.
The ruling sets a precedent for operators that may face similar regulatory disputes.
The High Court specifically noted the benefit must flow to Phumelela, the designated provincial operator at the time, and its new licence holder, 4Racing, after Phumelela went into business rescue.
Phumelela estimated it is owed R500m.
A report by then Public Protector Busisiwe Mkhwebane recommended the gambling board stop paying over the levy the regulator receives from bookmakers.
The board did so and it was this implementation that was challenged.
The impugned regulation provided that 6% of punters’ winnings from bets placed with bookmakers would be paid: 3% as a tax and 3% as a levy to racing companies which held totalisator licences. Gauteng MEC Lebogang Maile stopped the 3% going back to the horse racing companies.