The socio-financial; aspect of legalized gambling

2 May

The socio-financial; aspect of legalized gambling

Many governments have started legalizing online gambling, which once was a rare occurrence now a routine. For instance, most US states have legalized gambling in a restrictive way except Utah and Hawaii. Nevertheless, a recent study shows two out of three Americans have participated in gambling in some form or the other in the last twelve months; a lottery is the most preferred option. As the government is taking a more liberal approach to gambling, the industry is gaining popularity and prevalence. New companies are popping up, new versions of games are launched, and public debate is becoming more intense about the cost and benefit of gambling.

Government policy is the driving force

The gambling industry is not like other sectors of the economy, where demand and supply is the principal force. Instead, in the gambling industry government policy is the driving force; this factor decides the size and potentiality of the industry. In most cases where lottery gambling is permitted, the state that runs the show almost becomes a dominating provider.  When it comes to other forms of gambling, the state and federal decide the legal structure, license norms, location, size, and the number of establishments. The restrictive steps of governments are mostly due to the moral opposition to gambling. Another point of view is unrestricted gambling will increase problem gambling and create more potential problem gamblers.

The conventional view is gambling has a negative impact on society, bringing financial and family distress. Another school of thought thinks legalized gambling safeguard the interest of gamblers and increase consumer welfare. Casinos within a legal framework also encourage gamblers to wager responsibly. Another benefit of legalized betting is job creation and revenue generation for the state and local governments. Legal gambling websites like slot online fin88 are constant source of entertainment.

The gambling industry is subjected to taxation.  The revenue generated from online and land-based casinos impact the local economy. The tax rate varies from state to state, country to country; it is 6.25% in Nevada, while 35% in Illinois. However, most US states are not dependent on the tax revenue from the gambling industry, except the state of Nevada. All state-run lotteries use profit as the source of revenue. One dollar wagered on state lottery returns fifty cents to players in the form of prize, thirty cents to the state as profit, and the rest is used for administrative and overhead costs.  The revenue contribution to the state budget is quite significant, an average of 0.71% of the state budget where the lottery is permissible. The collected revenue from the gambling industry is spent on education and social welfare.