An “insider” last week told the South China Morning Post that Hong Kong’s 2024-25 budget, to be released tomorrow (26 February), may include a plan for legal wagers on basketball.
Support for legal hoops betting in Hong Kong is apparently on the rise as a way to generate tax revenue and also stamp out black-market operations.
The move would help the Chinese special administrative region (SAR) address a whopping budget deficit of more than HK$100 billion (£101.6 million/€122.5 million/$128.6 million) for the year. That’s more than twice the figure projected at the start of 2024.
PwC Hong Kong reports that the SAR government will have fiscal reserves of HK$639.8 billion at the end of March, enough to cover just 10 months of total government expenditures.
Reaping new revenue
Hong Kong bettors can already legally wager on horse races, football matches and public lotteries. All are run by the Hong Kong Jockey Club.
A proposal to add NBA wagers was floated last year, but it did not pass muster with Finance Secretary Paul Chan. Jockey Club Chief Executive Winfried Engelbrecht-Bresges, however, is all for it. In 2024, he estimated that about HK$350 billion in illegal bets per year are made in Hong Kong. Basketball represented about 15% of that
A legal, regulated industry could capture up to 60% of bettors who now patronize underground bookies, Winfried Engelbrecht-Bresges has suggested. That could mean HK$52.5 billion in turnover a year, and HK$1.5 billion in new taxes.
Those benefits would not accrue for some time, however. According to the Dimsum Daily, the Jockey Club would need at least a few years to get the system up and running. Football bets, for example, were legalised in 2001 but did not go live until 2003.
Then as now, lawmakers justified the expansion due to “large and persistent demand” and the proliferation of illegal operations. The underground market is “linked to other criminal activities … and cannot practically and fully be tackled by law enforcement alone”.
An about-face for Chan?
Despite the potential windfall, Chan continued to express concern about the social costs. In the past, he has rejected calls for expanded betting solely as a government cash cow.
Home and Youth Affairs Secretary Alice Mak also has reservations. In a December note to the Hong Kong Legislative Council, she wrote, “It is the government’s policy not to encourage gambling.”
Hong Kong currently allots HK$26.4 million to combat gambling addiction. It must “optimise efforts to prevent and alleviate problems related” to the pastime, Mak added.
Original article: https://igamingbusiness.com/esports/sports/budget-deficit-hong-kong-legalise-basketball-bets/
