Down Under: Overseas betting could drain the nation’s coffers by $3 billion
A study by Responsible Wagering Australia (RWA) has revealed that illicit offshore gambling might be costing Australians almost $3 billion (1.6 billion pounds/1.84 billion euros) in missed tax income.
The findings stem from the 2023 Australian Offshore Gambling Market Analysis Report, published by RWA on behalf of gambling and gaming consultancy H2 Gambling Capital.
H2 predicts that black market operations could result in $3.35 billion in lost tax revenue between 2022 and 2027. Coupled with an estimated $3.32 billion in lost tax revenue from the grey market, this could amount to a potential loss of $6.67 billion.
RWA highlights that overseas operators are more appealing to customers because they offer more competitive prices and do not provide the same stringent consumer protection regulations as licensed operators.
RWA CEO Kai Cantwell stated that future changes in Australia must focus on eradicating the offshore market, making it no longer a viable option for bettors.
“It is essential that any future reforms are balanced and prevent Australian players from being driven overseas, where player protection is limited,” Cantwell remarked.
Moreover, if a stable, controlled sports betting marketplace cannot be sustained, it could lead to substantial financial losses for the Australian economy and the sports, racing, and broadcasting sectors.
The study discovered that the illicit offshore gambling market in Australia is currently valued at over $1.1 billion, representing approximately 15% of the nation’s total gambling market.
H2 estimates that 92% of the online market was domestic in 2022. This proportion has been steadily increasing since 2017, when the domestic market was estimated to be 82%.
The consulting firm estimates that 96% of racing operations were domestic in 2022, while 78% of sports betting operations were domestic that year.
H2 also estimates that total betting income in 2022 was $77.1 billion and anticipates total betting income to rise further to $78.5 billion in 2023.
Black market activity is estimated to have generated $571 million in total betting income in 2022. The grey market generated $560 million in total betting income.
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