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Calls for Sin Tax on South Africa’s R1.1 Trillion Gambling Boom
South Africa’s gambling industry has hit a record high, with R1.1 trillion wagered in FY2023/24, a staggering 40.2% increase from the previous year. Gross gambling revenue (GGR) also soared by 25.7%, reaching R59.3 billion.
Amid these booming figures, political parties are calling for tighter regulations and a new “sin tax” on gambling, similar to those levied on tobacco and alcohol, to combat addiction and fund rehabilitation programs.
The Dark Side of a Growing Industry
While the industry thrives, a Bettabets survey reveals troubling statistics:
- 70% of gamblers bet to supplement income, not for entertainment.
- Nearly 50% gamble to meet rising living costs, such as rent and school fees.
- Only 27% of winners save or invest their earnings; most spend winnings immediately.
This highlights broader socio-economic challenges, including South Africa’s low savings rate and the desperation of many to cover monthly expenses through risky bets.
A Call for Reform
RISE Mzansi MP Makashule Gana has been vocal about the need for urgent reform, particularly around online gambling and advertising. Gana proposes several measures to tackle the growing crisis:
- Harmonising Legislation:
- Strengthening the Remote Gambling Bill and National Gambling Amendment Bill to regulate online gambling effectively.
- Restricting Advertising:
- Limiting gambling ads on TV, social media, and during sporting events.
- Regulating the use of social media influencers to promote gambling.
- Implementing a Sin Tax:
- Increasing the current 8% GGR tax to fund rehabilitation programs.
- Public Education Campaigns:
- Launching targeted awareness campaigns to educate citizens about the dangers of gambling addiction.
- Revised Revenue Sharing Model:
- Ensuring more equitable distribution of online gambling revenue between provinces.
Social Grants and Gambling Addiction
Gana has raised concerns about the link between social grants and gambling, citing long queues at betting establishments on grant distribution days. He argues that this trend underscores the need for stricter oversight and awareness campaigns to prevent grant misuse.
Oversight Challenges
South Africa’s National Gambling Board (NGB) is responsible for monitoring and regulating the industry. However, its oversight capabilities are in question as the NGB has lacked a functioning board for over a decade, hampering efforts to address the explosion of gambling activities.
With Parliament set to resume in 2025, Gana aims to fast-track legislative changes, ensuring gambling companies are held accountable for the social and economic fallout of their activities. As Gana puts it:
“There’s no country in the world that has gambled its way to prosperity.”
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