What are the problems legalization of the betting/gambling business in Ukraine can solve?

I just can’t miss the discussion about a draft law of legalization of the gambling business in Ukraine. This topic is extremely discussive, there are more enough expert opinions on this matter. Nevertheless, many talks about the political side of this issue. Like, what are the groups that had the biggest benefits from the ban of gambling back in the days and why the new government is having their own pros from the legalization right now.

Legal or not — the gambling business was somehow real in Ukraine, there was no point in denying it. Therefore, first of all, I would like to speak about the economic aspect of this problem. Zelensky’s government wants to achieve the status of the most progressive Cabinet in the entire history of Ukraine. And, therefore, the organizational and financial side of the issue has been worked out most strongly. It is used as the main argument. I propose to understand this in more detail.

Reducing the «shadow economy» and increasing the budget revenue

The most obvious argument, you’re clearly see it without me. It’s too early to talk about the actial numbers (I often saw about 5 billion UAH estimation). But the draft law is being constantly amended, but every estimations of budget revenues can be built on the basis of the «stable build» of this draft law.

But how exactly Ukraine will receive an income from this? First of all — licensing. Slot machines, casinos — for each type of such institutions there should be a license (and it will). The higher the level / class / status of the gambling enterprise — the higher the cost of the license. This will allow the state to get one-time income of serious amounts of money. Futhermore, the draft law already clearly speaks about the targeted use of the funds from licensing to finance medicine, sports and culture. Right move, especially effective against the aggressive moralists.

Secondly — the taxes. For example, the draft law refers to the verification of equipment according to international standards. The import of such equipment and its verification, of course, must have clear special taxes — which should be much lower than the fines for circumventing the rules. Then it will be more profitable to do everything honestly.

Improving the investment climate

It would seem like the most obvious conclusion, right? Typically, such things are written to fill in a pause or to make text a watered down. But here’s the trouble — usually people say the opposite things about gambling business. Here you can see how much the United Kingdom earns from gambling and betting — not a small island republic in the Caribbean, but an influential European country. Their legislation in this industry is much older than ours — which means they have something we can learn. Strict regulation and adequate tax policy have made British gaming licenses one of the most prestigious in the world. Even if Ukraine gets 1/10 of such success, this is a serious achievement.

The against problem gambling

When any business comes out of the shadow, it wants his reputation to be as white as possible. Legal status will make representatives of the gambling business think about the public portrait of their customer. They will more likely prefer to talk about luck, success in a positive, not volatile way. And for such a result, they will have to work: to cooperate with clinics, sponsor funds for assistance to gambling addicts etc. I am not saying that this will happen immediately. But in a civil society like Ukrainian, where public opinion determines the future of the country, only the legalization of the gambling business will be able to draw attention to the problem gambling as acutely as possible — after all, rights will always go with responsibilities.

CEO of the international payment system LEO, the shareholder of IBOX Bank