For centuries before, gambling and associated betting sports like poker were greatly restricted – as far back as 1673. Then came 1965 and a substantive gambling act was passed where gambling activity was banned in its entirety, save for betting in horse racing where horse racing was classified as a sports activity. In short, whoever engaged in playing poker or any other betting activity in South Africa did it illegally from 1965 on wards. Yet, gambling continued in the country, escalating in the ‘70s, with around 2000 illegal casinos coming up in the poor neighborhoods of the country.
Crime under Gambling
Unfortunately, banning gambling and not effectively controlling it on the ground leaves much room for illegal activity. For one, in the case of South Africa, a lot of gambling went on for many years without the government benefiting from its due share of revenues in an area where massive monies changed hands. Without relevant state laws in place to legalize an activity, a country cannot levy taxes on it.
Another danger that was posed by the underground gambling was money laundering. People played poker and other betting games with reckless abandon. In the meantime, other people went on a crime committing spree under the guise of innocent gambling, whereas they were actually laundering money without being traced. Other gambling related crimes were also committed within the country just because there was no poker law or any other gambling law helping to control the size of stakes and overall amount spent by an individual within set timelines and venues. So, heavy indebtedness created a very unhealthy gambling environment.
The Gambling Law As It Is
Effectively in 1996, South Africa passed the National Gambling Act which legalized brick and mortar casinos; a national lottery; and singled out betting in horse racing as a legal gambling activity. So today, not only do the state laws facilitate revenue collection through taxation from gambling, they also give room for the authorities to monitor betting activities with a view to curbing crime. Needless to say, money laundering is not just dangerous to the economy; it is also risky in terms of channeling funding for terrorist activities.
As far as online gambling is concerned, there is a bill in the pipeline, which proposes the minimum gambling age to be 18 years. It also seeks to protect gamblers from addiction by closely monitoring the gambling scene. South Africa seems to be coming up with tighter state laws on gambling than many other countries. The current bill even proposes that a gambler registers officially with a licensed provider of online poker or whatever other online gambling activity it is. When this bill is finally signed into law, even those gaming enthusiasts who have been playing online poker on illegal sites will now have to play on licensed sites only, and their use of credit cards will be restricted.
Needless to say, the exchequer will benefit more from the gambling activities as it is now easy to levy taxes on revenues earned through gambling. And there is, of course, the advantage that poker players and other gamblers with ill intent like money laundering will reconsider their attempts and the risks involved and abandon the idea of laundering money through South Africa’s online gambling sites altogether.