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This page is updated on 2007-01-17 16:49
Christian Service News

Issue 54 (January 2007)

 

Opinion Feedback

$1 Gambling Tax Income
Leads to $8.5 Expenditure

According to a study by Gambling Watch, of which Hong Kong Christian Service is a member, there is more damage than benefit done to society if gambling is uncurbed, especially if casinos are built in Hong Kong,

Taxpayers have to pay the same amount of income from gambling tax to provide remedial services to tackle problems that arise due to gambling activities legalized by the government. That is, for every dollar collected as gambling tax, the government in turn has to spend one dollar on relevant public services. On top of this, there are also costs to be borne by the gamblers themselves and by their families. As a result, Hong Kong society as a whole has to bear costs and damages eight and a half times the tax money received.

A study on the Social Cost of Gambling in Hong Kong was conducted in May to June 2006. 110 cases seeking services from gambling counseling centres were interviewed. It was found that horse racing was the most popular gambling activity participated (63.1%), followed by casino gambling (52.4%) and soccer betting (39.8%). In the past year, before the interview, each interviewee spent an average of 920 hours a year in gambling. The median amount of money won in gambling was $60,000, but this was incomparable to the median amount of money lost in gambling, which amounted to $290,000. This means that each of them had to bear a debt of $300,000, although their average income was only $13,500 a month. That is, they have to work for 2 years in which they spend no money and eat nothing to pay for their debt.

The social cost (mainly public services which include expenses of the court, police, hospital, social services and relevant services) is found to be as high as $39,750 for each problematic or pathological gambler, while individually each of them (including family cost) has to bear a cost of $310,000. Thus the total cost (the sum of individual, family, and social cost) for each problematic or pathological gambler is as huge as $379,650 (at median). This equals to 3 years' salary for one who earns a median income in Hong Kong.

As there are 272,000 problematic and pathological gamblers according to the 2005 survey by the government, the total amount of social cost can be as high as $11 billion, whereas the gambling tax collected in 2005 was only $12 billion. If the figure for the total cost is used, then the overall total cost as a result of problematic and pathological gambling is an astronomical figure of $105 billion. Based on the above figures, it is derived that for every dollar received from gambling tax, Hong Kong society as a whole has to bear a cost of $8.50. In other words, one dollar's gambling tax income will lead to $8.50 expenditure.

This situation will be further aggravated if casinos are built in Hong Kong. If 50% of the problematic and pathological gamblers go to casinos, using the above figures for estimation, the total cost as a result of casino gambling will be $72.7 billion, equivalent to 5.19% of Hong Kong's GDP. Even if only the social cost is considered, the total social cost borne by taxpayers, including you and me, will still amount to $2.5 billion.

It is unwise and uneconomical that the government further promotes gambling in Hong Kong.


Copyright Hong Kong Christian Service