This brings us neatly onto the case for legalising and regulating online gambling in India, which is certainly compelling from a tax and revenue perspective.
At present, for example, it’s estimated that the cumulative value of India’s online gambling entertainment industry is a whopping $930 million, which is reflective of the huge demand in the nation and the average amount currently wagered annually online.
However, this money is currently being diverted into the coffers of international operators and the treasuries of economies such as the UK and the US.
This surely represents a golden opportunity that is being squandered by the Indian government and state authorities, as this income could be generated on behalf of domestic operators and reinvested into the national economy.
To provide further context, let’s look at the example set by New Jersey. One of the first US states to legalise online casino gambling (and subsequently sports betting) back in 2012, New Jersey has become a highly generative and lucrative state and one that has blazed a trail for others (including Delaware and Pennsylvania) to follow.
By licensing and regulating, the state has been able to apply a tax rate of 15% to slots and table games. Remote sports wagers are currently taxed at 8.5% if they’re placed in brick-and-mortar casinos and the higher rate of 13% if they’re executed online.
As a result, New Jersey has banked incrementally higher tax revenues over time, with this peaking through 2020 and the first half of 2021.
For example, February saw the state generate a total of $5.8 million in tax from remote sports betting alone, while this number peaked at an astonishing $53.8 million prior to the coronavirus pandemic in January 2020.
This makes a compelling case for the legalisation of online casinos and different way of entertainement in India, especially as this developing economy continues to grow and evolve at a rapid pace.
Furthermore, the overall gambling market is thought to be worth $60 billion in total, but a staggering half of this is currently wagered illegally. This not only equates to more lost tax revenue but also suggests that punters could be at the mercy of rogue operators in some instances.
Not only does this equate to a considerable sum from the perspective of tax revenues, but it’s also crucial that everyone’s bankroll is protected at all times. Otherwise, trust may be eroded over time, creating a scenario where demand dwindles before states have the opportunity to fully legalise and monetise online gaming.