Following a plea in the Kerala High Court that sought to ban online gambling apps such as online rummy, the High Court has directed the state government to take a decision. This might mean that soon, online gambling may come to be included within the purview of the Kerala Gaming Act, 1960. The Kerala Gaming Act prohibits gambling and betting in the state, and the formal inclusion of online gambling in the Act will put a stop to the growth of the industry in Kerala.
Up until now, online gambling existed outside the radius of formal laws, making it a convenient loophole for many online gaming apps and betting websites to placate. And as a result, the industry has seen a great rise in the number of users in 2020. The pandemic and the lockdown made things easier for real-money gaming apps, which became a great comfort for people stuck at home, with little else to do.
And while many states like Andhra Pradesh and Tamil Nadu have recently decided to form ordinances and laws against online gambling, other Indian states have considered formally legalizing and regulating the sector. In the many countries where online gambling is legalized, the situation is quite different from that of India.
Due to the recent outburst of several real-money gaming apps as well as cricket betting sites that shoot up in popularity during the IPL season, the need to address the online gambling presence in India is becoming quite evident. However, a blanket ban on all online gambling activities has been near impossible to enforce.
Online gambling platforms argue that there are more than a few reasons why the online gambling situation could be handled better with formal legislation that regulates the sector, instead of banning it. Indian states like Sikkim, Nagaland, and Telangana have already taken some steps towards regulation. For one, regulation of the sector seeks to protect the public from the negative effects of using such apps. For another, the regulated online gambling industry could produce millions, if not billions of dollars, in terms of taxation for the state governments. However, skeptics argue that the social impact of gambling outweigh the revenue benefits.
The Maharashtra government is now trying to regulate and legalize the sector, instead of deeming it illegal. Their theory is that since there is virtually no way to completely stop illegal gambling and online betting activities, it is better to formally mobilize funds by taxing the transactions. According to preliminary calculations, GST from online gambling transactions could collect around 2500 crores for the state government annually.
It is also argued that the regulation of the industry will help protect users from fraudulent gambling apps and websites. Having legitimate and licensed betting websites and casinos will allow players to rest easy in the knowledge that they will not be conned out of money. A great example of this is countries like the UK, where online gambling has been formally legalized for years now.
Owing to the highly regulated industry, gambling platforms argue that there are even lesser instances of players going overboard with their gambling habits in the UK than in India. Since the activity is a widespread hobby, there are more support organizations that help players gamble responsibly and safely, they say.