Gambling’s community contributions: does the community benefit?

Abstract

Background: Harms from gambling are considerable and widespread, impacting beyond the individual gambler. Asserting benefits, including supporting 'good causes' outweighs this harm, is a common legitimization tactic of commercial gambling. Identified as problematic on many levels, this is a global phenomenon. Using unusually transparent data, this research assesses the extent to which such contributions offset gambling harms. Methods: Commonly in Australian jurisdictions, not-for-profit gambling operators (clubs) qualify for gambling tax reductions. To qualify in the state of Victoria, clubs submit annual statements documenting that at least 8.33% of their net gambling revenue (NGR) supports community purposes. We examined community benefit records from three consecutive annual reporting periods (2012)(2013)(2014)(2015). Results are presented in aggregate, and via specific case studies. Results: We identified significant over-valuation of 'community benefits'. Gambling tax deductions overwhelmingly (82%) went to operational expenses including wages, venue maintenance, capital costs and utilities. Contributions to charitable and philanthropic purposes represented 4.5% of all community benefit claims (1.5% of club NGR). Conclusions: Similar to other jurisdictions, Victoria's community contribution arrangements provide limited actual community benefit. Doing little to offset gambling harm, demonstrated benefits largely accrue to specific sectional interests. Greater transparency and improved governance is required. This includes, reviewing tax exemptions, reviewing allowable claims, and greater compliance oversight. This research identifies multiple failings with a community benefit scheme operating in a relatively transparent manner. Research lessons may be of interest to policy makers and others wanting to ensure that gambling's demonstrable harms are, indeed, offset by clear benefits to community, and to preventing gambling harm.

“Aussies love a bet”: Gamblers discuss the social acceptance and cultural accommodation of gambling in Australia

“…Finally, there was the perception that gambling had many positive social and economic benefits for communities, although there is limited evidence that supports this perception with public health researchers arguing that any benefits are inequitably distributed across the community 1 . For example, taxes collected from EGM losses in Victoria are taken from the communities from which they are lost (disproportionately in low socioeconomic areas) and redistributed to other areas, 49 while the ‘community contributions’ made by venues are typically reinvestments into venues through means such as utility costs and capital works, with only a small amount being used for philanthropic purposes 50 . It is important to note that some participants were sceptical about benefits for the community due to the harms and addiction associated with gambling.…”

“…1 For example, taxes collected from EGM losses in Victoria are taken from the communities from which they are lost (disproportionately in low socioeconomic areas) and redistributed to other areas, 49 while the 'community contributions' made by venues are typically reinvestments into venues through means such as utility costs and capital works, with only a small amount being used for philanthropic purposes. 50 It is important to note that some participants were sceptical about benefits for the community due to the harms and addiction associated with gambling. However, given that research demonstrates that gambling has considerable economic and social costs, 7 there is a clear role for governments in challenging the common perception that gambling is a positive and normal activity for communities, including reconsidering how governments talk about gambling products and events.…”

Commercial Gambling and the Surplus for Society

“…In some cases, it is delivered as dividends to public owners. Public revenue is a patent justification of advancing legalised gambling (Egerer, Marionneau & Nikkinen, 2018;Francis & Livingstone, 2020;Nikkinen & Marionneau, 2014).…”

Evaluation of Gambling Sector Activity in Lithuania, Latvia, Slovak Republic and Czech Republic

“…The gambling sector has been examined by researchers in analysing: gambling harms and benefits of gambling [2][3], other sectors cannibalization [4], gambling sector policy and regulation [1,3,[5][6][7] and online gambling specifics [3,8].…”