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Illegal land-based Gambling and its Effects


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People love to gamble, that is just a fact. And when done within limits and within a budget that doesn’t harm the financial wellbeing of the person or their family there’s nothing wrong with it. It is fun and for some people it proved to be quite lucrative. And it has been around, in one form or another, for quite a while now, probably since the first currency was invented. Gambling has been illegal in many countries during many shorter or longer periods throughout history. It is still illegal in quite a few countries even in this day and age. Some governments have more liberal attitudes towards gambling, whereas others are more restrictive. Some countries had one approach to land-based casinos and another to online casino. South Africa was an example of this, fortunately that changed and online casinos are now legal in the country. Nowadays there are a lot of online casinos in South Africa. 

Why Gambling should be legal

Some people are opposed to gambling for religious or other reasons, but no matter how hard governments have tried in the past, they simply couldn’t abolish gambling. Even if they make it totally illegal and impose strict punishments on people who gamble and entities that organise gambling, people still do it. Trying to make gambling and casinos illegal proved to be counter-productive. There are few pretty negative effects of criminalisation of gambling. First of all, people who participate in illegal gambling have no protection. They don’t have any means of checking whether the gambling event is legitimate or a complete rip-off. Even if someone brutally steals their money, they can’t complain because gambling is illegal. Furthermore, it encourages criminal entities such as mobs, gangs and the mafia to get engaged in gambling related activities. Thus, the level of crime is increased.

Financial Gains from legalised Gambling

But, there’s an even worse effect. Namely, the state cannot charge any taxes or levies on gambling and therefore cannot cash in on significant amounts of tax money that would’ve otherwise been collected. In South Africa, for example, more than 20% of the total casino revenues are collected by the state as tax. Having a more liberal attitude towards the legal status of gambling can be a benefit to everybody. Not to mention that the casino industry is quite big and it employs a lot of people, that would’ve otherwise been jobless. A lot of other people, from other industries are indirectly employed by the casino industry. For example a lot of construction companies work on building casinos and adjacent objects. Moreover, with the increase of popularity of online casino gaming, a lot of IT experts are employed by online casino owners. 

The negative effects of Illegal land-based Gambling

We already said that people will gamble even if gambling is made illegal. However, once it is made legal, the state has to do everything to tackle illegal gambling. First of all, it is better for the players. Even though some illegal gambling facilities may offer better odds, the danger here outweighs the gain, because you simply cannot trust people who organise illegal gambling. Moreover, these establishment are unfair competition to the legal casinos, since they pay all their taxes, employ people who are registered and have their social and health security paid for, etc. Finally, the state loses a lot of money in tax revenues from illegal land-based gambling. 

In South Africa for example, the country loses about 110 million ZAR in tax revenue. This is not an insignificant amount of money. If states and governments take measures to stop illegal land-based gambling, close such establishments and punish the culprits, that will discourage people in the future from engaging in such activities. On the other hand, if nobody is punished and there aren’t any repercussions, then more and more people will get into it. Illegal land-based gambling has a negative effect on the casino fans, on the legitimate casino industry as a whole and on the states and their financial resources as well. 

Date Posted: 2016-02-26
Posted By: GBN Online
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