How Much Does a Government Earn From Legal Gambling?

Statistics suggest that more than 1.6 billion people gamble worldwide – that’s 26% of the global population. It’s safe to say that gambling is entertainment for many, making it a lucrative sector for governments. 

Gambling - A Global Worth of $172 Billion

The global worth of gambling will be worth approximately $172 billion by 2023, so what does that mean for those in charge? How much do governments earn? Well, of course, it varies as each country has its own taxation system when it comes to gambling. The industry is regulated differently in each country, and some countries have their governance in different areas, for example, the USA. 

On the topic of the USA, Las Vegas is the gambling capital, and business is booming – a lot of that is down to the city’s reputation as the biggest entertainment area across the globe, boasting some of the largest and most luxurious casinos of anywhere else. At the end of 2021, Vegas made $13.4 billion in pre-tax gaming figures and it is believed that the US government makes in excess of $100 billion annually in tax revenue from gambling (which includes Las Vegas and gambling in other US states).

Governments everywhere do reap the benefits as do licensing organisations in each country because they also collect fees. Governments can tax operators for their revenues and on top of that, tax gamblers too, on their winnings. So, there are plenty of sources of revenue for governments. 

The only countries that don’t take a cut of gambling profits are those where the practice is illegal, for example, Qatar, Lebanon, Cyprus and Poland – but being illegal doesn’t stop underground gambling. That’s why most governments prefer to regulate this form of entertainment, to take a cut through taxation and fees (there are other reasons too).

The UK’s Gambling Sector is Worth Nearly £15 Billion

Gambling is unsurprisingly big in the UK, worth £14.7 billion. The industry is one of the most profitable sectors of all, and while there are countless people who disagree with it from a moral point of view, it is an essential part of the UK’s economy.

Online Gambling Is the Strongest Slice of the Pie

In the UK, the most profitable area of the gambling industry is online gambling, which covers betting, casinos, bingo and lotteries and generates 39% of the profits. The National Lottery is responsible for around 21% and bingo halls 4.7%. The rest is shared between bricks and mortar casinos and bookmakers.

The UK’s Gambling Bill

Several years ago in 2014, the UK government introduced the Gambling Bill, designed to protect gamblers and improve their overall gambling experience. Additionally, the act brought in a 15% tax on all profits, meaning that gamblers no longer needed to pay tax on their winnings. As well as safeguarding gamblers (to a point – of course, there are still risks attached), the bill ensures that the UK economy benefits from the sector’s growth. The forecast for 2022/2023 is for betting and gaming duties to raise £3.3 billion for the government. 

Here’s an example of what each individual gambling activity made in duty for the period 2017/2018 and gives you an idea of what the UK government is set to make for the coming period:

• Lottery duty raised: £831 million.

• Slot machines/game machines: £712 million.

• Bookmakers (including sports betting and racing betting): £527 million.

• Online gambling: £443 million.

• Bricks and mortar gambling: £265 million.

• Bingo: £32 million.

Final Words

The gambling industry continues to be buoyant in the UK as well as across the world and will grow over the coming years. Much of that growth will come from online casinos and online gambling activities in the UK. The government is expected to continue to monitor how the industry is regulated and improve on current rules and regulations to protect gamblers from illegal websites. 

If you do gamble, it is essential that you choose a reputable online gambling platform with the appropriate certification to make sure that you are protected. You can find more information on our gambling licences page.