They are just making it worse.

I think it was discussed here in the forum many times about banning online gambling in certain countries. It will create an effect where gamblers will try looking for another option to gamble, and I bet they will find it through illegal means or in offshore online casinos.
This means no taxes claimed by the government, and worse, it could be the spark of an increase in the crime rate when people start to play in illegal casinos.

Regulate it. Have strict rules about the amount of deposits. Take the tax. I believe that's the only solution for now, instead of banning everything.