The government of Sri Lanka has announced two major initiatives aimed at reshaping the country’s gambling industry: an increase in casino taxes and the creation of a new regulatory authority to oversee the entire sector. Under the new rules, the tax rate on gross gaming revenue will rise from 15% to 18%. Additionally, local players will see the cost of entering casinos double, from approximately $50 to $100 per visit. To ensure proper oversight, Sri Lanka is establishing the Gambling Regulatory Authority (GRA), a single agency responsible for licensing operators, monitoring compliance, and combating illegal gambling activities.
For a country that faced a financial crisis in 2022–2023, these changes are part of a broader economic recovery strategy. Authorities hope that a transparent and well-regulated gambling market will attract more international tourists, boost foreign investment, and increase government revenues. Casinos, particularly those operated by international companies, are seen as a key driver of this economic growth.
The new regulator will have authority over both land-based and online casinos. Currently, around 60–70% of gambling activity in Sri Lanka occurs online, while physical casinos generate a smaller share of revenue. This means a significant portion of the market has historically operated outside the formal regulatory framework. With the GRA in place, all operators will be required to meet consistent standards, report revenues, and adhere to strict legal requirements.
For the gambling industry, this represents a significant transformation. While higher taxes and stricter oversight will increase operational costs, they also create a clear and stable framework for legitimate business. The reforms signal a shift toward a regulated market that protects players and encourages fair competition.
Experts warn that challenges remain. Some operators may struggle to comply with the new rules, and increased taxes could reduce Sri Lanka’s competitiveness on the global market. However, the establishment of a unified regulator provides an opportunity to create a transparent and sustainable gambling sector.
In summary, Sri Lanka is taking a decisive step toward modernizing its gambling industry by combining economic incentives with robust regulatory oversight. These measures aim to create new opportunities for investors, ensure transparency for players, and lay the foundation for the long-term development of the country’s gaming market.
