Lot­tery And Gam­ing Law Passed but will it In­flu­ence the gam­ing in­dus­try?

By: Jacky Kemigisa

The Par­lia­ment of Uganda on No­vem­ber 12, 2015 passed the Gam­ing and lot­ter­ies Bill. The ob­jec­tive of the law is to re­form the law re­lat­ing to the con­duct of lot­ter­ies and casi­nos in Uganda.

The lot­tery and gam­ing in­dus­try be­fore the pass­ing of the bill was reg­u­lated by the Na­tional Lot­ter­ies Board (NLB) and guided by the Na­tional Lot­ter­ies Act of 1967, the Gam­ing and Pool Bet­ting (Con­trol and Tax­a­tion) Act of 1968, and an ad­den­dum of statu­tory guide­lines in­tro­duced in 2012/​13.

Ac­cord­ing to the com­mit­tee re­port on Fi­nance, plan­ning and Eco­nomic De­vel­op­ment, the com­mit­tee ob­served that the pre­sent leg­isla­tive frame­work gov­ern­ing the gam­ing in­dus­try is out­dated and no longer forms an ap­pro­pri­ate or ef­fec­tive reg­u­la­tory frame­work that can be used to gov­ern a mod­ern and fast gam­ing in­dus­try.

The com­mit­tee fur­ther rec­om­mended the es­tab­lish­ment of an in­de­pen­dent reg­u­la­tor whose func­tions will be to reg­u­late and mon­i­tor the gam­ing in­dus­try , fos­ter com­pe­ti­tion through li­cens­ing of op­er­a­tors.

The reg­u­la­tory body must be built around the phi­los­o­phy of con­sis­tent le­gal, eth­i­cal and fair mind prac­tices and ac­tions, bol­stered through highly rig­or­ous stan­dards for li­cens­ing, sus­tain­abil­ity and op­er­a­tion.

The re­port pro­posed, that fail­ure to pay taxes within 30 days would au­to­mat­i­cally re­sult into the sur­ren­der of the gam­ing li­cense and re­quire im­me­di­ate clo­sure of the gam­ing op­er­a­tion. Key ques­tion is, does gov­ern­ment have the man­power to en­force all these ‘won­der­ful’ reg­u­la­tions?

In 2012, gam­bling was named a “new dri­ver of chronic poverty” among young peo­ple in the coun­try by Ac­tion Aid In­ter­na­tional Uganda, De­vel­op­ment Re­search and Train­ing, and the NGO Board of Uganda, which re­ported, “Many youth are aban­don­ing par­tic­i­pat­ing in pro­duc­tive ac­tiv­i­ties for gam­bling, es­pe­cially sports bet­ting.”

The over­whelm­ing pro­lif­er­a­tion of lot­tery, casi­nos and sports bet­ting in Uganda has seen the gam­bling in­dus­try de­velop in terms of pen­e­tra­tion and rev­enue gen­er­a­tion. Gam­bling re­lated tax rev­enue has in­creased by about thirty-fold over the past decade, from Ugx 0.24 bil­lion in 2002/​3 to Ugx 7.4 bil­lion in 2012/​13.

These rev­enues are set to in­crease even more with the in­tro­duc­tion of a new 15% tax levied on win­nings as per the 2014/​2015 bud­gets. As the gov­ern­ment con­tin­ues to search for more fi­nanc­ing op­tions for the na­tional bud­get, the gam­ing in­dus­try is fast be­ing rec­og­nized as one of the more un­der­uti­lized po­ten­tial tax bases.

How­ever, it re­mains to be seen as to if  the new law cur­tail the vices that come with gam­ing for young peo­ple in Uganda. Also quite im­por­tant to note is whether gov­ern­ment has the re­sources to fund the es­tab­lish­ment of an in­de­pen­dent body.