Will Hong Kong legalise betting on basketball?
As betting on basketball gains traction among Hong Kong’s enthusiasts through illegal channels, the Chinese Special Administrative Region (SAR) is contemplating the legalization of such wagers as a strategic response to its pressing budgetary challenges.
According to a report by the South China Morning Post, insiders reveal that Hong Kong’s upcoming 2024-25 budget, set to be unveiled on February 26, may outline a framework for permitting legal basketball betting.
Momentum is building around the idea of regulated basketball wagering as a potential avenue for generating tax income while simultaneously curtailing the rampant black-market betting operations.
This legislative shift could significantly aid the SAR in addressing a staggering budget deficit projected to exceed HK$100 billion (approximately £101.6 million/€122.5 million/$128.6 million) for the fiscal year—a number that has more than doubled since initial estimates for 2024.
As noted by PwC Hong Kong, the government is expected to conclude March with fiscal reserves around HK$639.8 billion, a figure sufficient to cover merely ten months of total government spending.
Unlocking New Revenue Streams
Currently, bettors in Hong Kong can legally place wagers on horse racing, football matches, and public lotteries, all of which are conducted by the Hong Kong Jockey Club.
A proposal to introduce NBA wagering was tabled last year; however, it did not gain traction with Finance Secretary Paul Chan. Nevertheless, Winfried Engelbrecht-Bresges, the Jockey Club’s chief executive, has signaled strong support for the measure. He estimates that annual illegal betting activity in Hong Kong reaches around HK$350 billion, with basketball bets comprising approximately 15% of this figure.
A legitimate and government-regulated betting framework could potentially attract up to 60% of the bettors currently engaging with underground bookmakers, Engelbrecht-Bresges asserts. This transition could yield an impressive HK$52.5 billion in annual turnover and generate HK$1.5 billion in new tax revenue.
However, the realization of these benefits is likely to take time. The Dimsum Daily reports that the Jockey Club would require a multi-year timeframe to set up a comprehensive system. For instance, while football betting was legalized in 2001, it only became operational two years later in 2003.
Lawmakers previously justified this expansion in betting options by citing “significant and ongoing demand” alongside the expanding prevalence of illegal gambling activities. The underground betting market is often associated with other criminal enterprises, which makes enforcement and regulation challenging for law enforcement agencies alone.
Chan’s Dilemma: Addressing Risks and Rewards
Despite the potential for considerable financial benefits, Finance Secretary Chan has expressed ongoing reservations regarding the social implications of expanded gambling options. He has historically resisted initiatives that appear to view gambling solely as a revenue generation tool for the government.
Similarly, Secretary for Home and Youth Affairs Alice Mak has voiced concerns. In a statement to the Hong Kong Legislative Council in December, she reiterated the government’s stance against promoting gambling practices.
Currently, Hong Kong allocates HK$26.4 million annually towards efforts aimed at combating gambling addiction, emphasizing the necessity to “optimize efforts to prevent and mitigate issues associated with gambling,” as stated by Mak.
