A new report released by KPMG, the global accounting and advisory group, indicates that certain governments, including the Australian government, may want to consider relaxing online gambling rules and regulations as the prospect of increased tax revenues becomes more of an incentive.
The report, entitled ‘Online Gaming: A Gamble or a Sure Bet?,’ quotes predictions that the international online gambling market is expected to grow by 42% from USD21.2bn in 2008 to USD30bn in 2012 with, it is said, substantially increased revenues for land-based gambling operators, software developers and investors.
Prospects for growth, the report says, are enormous since some of the biggest potential markets (Australia, US, China, Japan and South Korea, in particular) prohibit many forms of gambling over the internet.
For example, it points out that “China is an exploding market for Internet games; however it does limit land-based casino gambling activities to Macau, and prohibits online gaming altogether. Korea, an enormous market for online multi-player games, may have online gamblers, however gambling online remains illegal in Korea as well.”
“While it is difficult to predict political and legislative action,” the report adds, “many markets that now ban online gaming could easily change their laws as a means of authorizing what is now an underground economy and increasing tax revenues.”
As Anthony Travers, of KPMG Australia’s Gaming Industry Practice, said: "Governments in many parts of the world are quietly rethinking their opposition to online gambling. With the potential for growth in the sector increasing, the market we see now could be just the tip of the iceberg.”
He reiterated that Australia is one of the biggest markets that currently prohibit forms of online gambling. "Australians spent an estimated AUD790m (USD738m) on offshore gambling sites in 2008. It is an underground economy that could become authorized with a sustained period of re-regulation and expand significantly.”
KPMG thinks that the Australian Productivity Commission’s draft recommendation, in October 2009, to lift the 2001 Interactive Gambling Act and repeal the prohibition of online gambling, such as poker and casino games, could lead to a significant expansion of the local online gambling market.
A comprehensive report in our Intelligence Report series examining the new possibilities that offshore e-commerce open up for business, and analysing the offshore jurisdictions that have led the way in offering professional e-commerce regimes for international business, with a particular focus on e-gaming, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report6.aspTags: tax | law | offshore | internet | gambling | offshore e-gaming | Australia | regulation
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