By the Books: As Global Gambling Rebounds Post-COVID-19, How Will Countries Spend Their Casino Cash?

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Gambling is slowly becoming a major industry across numerous global economies, but just how much of the funds spent in the betting agencies goes back into businesses and local governments?

A Peak at the Global Gambling Industry

The gambling industry, online as well as brick-and-mortar businesses, are quickly becoming a staple of the global economy.

Roughly 26 percent of people gamble regularly around the world, with a further 4.2bn betting at least once a year, depending on nationality, statistics show.

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According to figures in the UK, around 47 percent of Brits gamble once a month, including via lotteries.

Analysts expect a rebound of revenues in 2021 following the ongoing COVID-19 pandemic, with the industry expected to gain nearly $516bn in revenues and grow 10.8 percent each year, a report from Research and Markets revealed.

1.8m jobs were created in the United States in 2018, with 110,000 in the United Kingdom the same year, stats reveal, adding governments expect massive benefits from regulating the gambling industry.

Gambling Distribution in the United States

Each state in the United States decides on how to tax gambling companies, a 2020 report from the American Gaming Association revealed.

Mississippi takes a cut of tax revenues for the Department of Transportation to fund public infrastructure such as sewer, water and roads, among others.

New Jersey uses gambling taxes for projects for the elderly and disabled via the Department of Human Services.

Nevada, the gambling capital of the country, funds its health, human services and education sectors with its massive gambling industry. Rhode Island and Maryland also allocates funds for public schools.

Gambling Tax Distribution in the Rest of the World

Other countries have widely different policies on gambling tax distribution, with most being used on public infrastructure, healthcare and education.

Australia's federal constitutional monarchy is similar to the US, and each state outlines rules for gambling tax distribution.

Victoria earmarks lottery revenues towards hospitals, while Queensland has similar measures for sports and recreation.

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The UK, Russia, Canada, Italy, Finland, Sweden, Germany, Australia and numerous others do not tax winnings, and operators pay their respective governments based on gross revenues, Research and Markets reported in 2019.

But France taxes land-based casinos up to 83 percent but horse racing at only 37.7 percent. Germany has a turnover tax rate of around 5 percent on sports betting, but taxes local gaming firms from 20 percent to 80 percent.

German states receive most of gambling tax revenues, with each regional council or government deciding on how to spend the funds and most injecting them into school programmes.

Spain's Ministry of Education, Culture and Sport implements a resolution of the Chairperson of the Senior Sports Council.

But North Macedonia sets aside a major portion of its gambling tax earnings for its government-led film fund.

Pros and Cons of Gambling Regulation

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Gambling regulation adds value to economies by boosting tourism and jobs, as well as backing numerous government projects and indirectly supporting industry verticals, namely in transport, hospitality and healthcare.

But gambling addictions and other problems can lead to further regulations. According to statistics, around 3 to 5 out of 100 gamblers develop a compulsive gambling addiction, leading governments to find ways to further tackle the concern.

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