Toronto Mike

What Should Canada Spend Its Gambling Revenue On?

Spending Gambling Revenue in Canada

Gambling, both offline and online, is on the rise in Canada. This also means more employment and revenue from the industry, and raises the question of how the country (and the provinces) should spend the money.

Rising Revenue

According to the Canadian Gaming Association (CGA) the national gambling revenue of 2018 was some $16.1bn. There was also an additional $1bn generated through related sectors, such as entertainment and accommodation.

Revenue comes from a range of gambling establishments, including casinos, video lottery terminals, lotteries (both commercial and charitable), bingo, horse racing, and online betting. Casinos contribute about half the total revenue, and the majority of the related extra $1bn mentioned above.

As a trend gambling is becoming increasingly popular globally, increasing both revenues for governments and the range of casinos and betting opportunities for players. If you enjoy wagering at online casinos then this one site provide a range of recommended no deposit Canadian casinos to bet at might be up your street. No deposit promotions provide all the thrill of betting without needing to even deposit a cent of your own money - and you have the chance to withdraw too if you meet the terms and conditions.

How Gambling Revenue is Spent

In 2018 Alberta recorded gambling revenues of $1.736bn, a modest rise driven by increasing use of video lottery terminals. The revenue gathered in the province, added to Alberta’s share from the Western Canada Lottery Corporation, is funnelled (minus certain costs) into the Alberta Lottery Fund.

The Alberta Lottery Fund in 2018 was $1.4bn, and is used by Alberta’s provincial government on a range of expenditure. The largest portion (almost half at $638m) went on healthcare, particularly continuing care. The other big ticket items of spending from the fund include school transportation, cultural and tourism grants, and the First Nations Development Fund.

Smaller funding areas include community and social services, highway maintenance, agricultural and park expenditure.

In addition to this there is the charitable gaming classification, which covers casino table games, bingo, and raffles in Alberta. The money gained thus, roughly a third of a billion dollars, is destined for approved charitable/religious purposes.

This highlights an interesting contrast, and one that is likely politically expedient for keeping the public onside. Gambling is enjoyable, but also risky, and by using revenue derived from the pastime for charitable works (and essential public spending) governments at a local and national level can help maintain support for a variety of betting establishments.

It’s also worth noting that gambling isn’t an activity that exists in a silo. When people visit a casino they buy drinks, go out for meals, perhaps they see a show before or after, thereby boosting the wider entertainment economy.

Canadians gamble around $4bn a year in offshore casinos. However, this is dwarfed by the amount that is bet at Canadian casinos, which is about four times higher. That’s particularly interesting when you learn that online casinos pay out 13% more than their brick and mortar counterparts in the real world.

Future Political Directions?

The two largest political parties in Canada right now are the Liberals and the Conservatives. Canadian politics is neither excessively puritanical nor permissive, and the provincial laws vary significantly (NB federal law permits online gambling, but local laws affect whether domestic casinos, online or brick-and-mortar, and other betting operations can come into effect).

The governing Liberal Party has committed itself to a revenue and expenditure review. Although the results of this remain to be seen, the party has stated it is strongly against austerity and cuts, suggesting a desire to spend more which may mean spending revenue from the gambling sector to try and reduce poverty.

The official opposition is the Conservative Party, who emphasise free enterprise and opportunity. This pro-business approach may see a desire for more relaxed gambling laws to encourage more establishments in the sector and thereby increase employment and revenue through a larger sector rather than increasing taxation.

Another factor that might see the law liberalised to increase gambling revenues is what’s happening across the border. Michigan and New York state are both seeing a push to legalise online gambling operations for state operators, and if residents of Toronto, just across the border, don’t get the same then they might start popping over to the USA for a spot of light betting.

Unsurprisingly, there’s now a corresponding drive for legalising online gambling in Toronto. New Jersey has had great success with this route, and Canadian authorities will be keen for any gambling revenues from Canadians to actually go to Canada, rather than the USA.

In order to maintain support for gambling (being aware the industry both employs many people and contributes significant sums in revenue whilst also involving a potentially risky pastime) it may be politically expedient for any party to earmark money gained through gambling revenue towards supporting those down on their luck. Another potentially astute political move, bearing in mind real world casinos tend to be located in big cities, is to link casino revenue with big city problems such as homelessness.

Ultimately, the political verdict of the electorate will determine what approach is taken by Canada going forward.

Author image
About Toronto Mike
I own TMDS and host Toronto MIke'd. Become a Patron.