Analysis of the Issues Related to Casinos and Economic Development in Canada
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Canadian laws strictly regulate most aspects of the country’s gambling market, but the industry still thrives and shows great growth potential. In 2021 only, it totaled $12.5 billion, which makes casinos one of the largest sectors of the state economy.
The latest legislation amendments have lifted a ban on single-game bets, which was a significant step toward industry liberalization in 2021 that attracted thousands of new players.
The legalization of iGaming in Ontario in 2022 became the next crucial milestone. Though no other provinces have followed the example yet, this could lead to the regulation of online casino gambling on the state level.
The economic effect of casinos is obvious at least due to the annual turnover figures that significantly outreach many other industries, including air travel. There are several ways how gambling market impacts the state economy.
1. Casinos Boost Employment Level and Create New Jobs
The statistics show that the casino industry created over 135 000 direct jobs in recent years and 267 000+ jobs supported by the gambling market. The provinces with the most employees in the casino niche are Ontario, Quebec, Alberta, and British Colombia.
The labor income generated by the industry estimates at billions of dollars. Only in 2006 it reached $11.6B. The figures will likely rise drastically with the anticipated increase of casino-related jobs in the ensuing years.
The gambling market affects the employment level in such spheres:
- land-based casino personnel;
- entertainment (concerts, shows, and exhibitions);
- restaurants & bars;
- game products development;
- Internet technology (website design, content, and maintenance).
2. Casinos Contribute to the Province, and State Budget
Offline casino venues and online gambling sites that operate legally in Canada are crucial sources of tax income. The best example is the Ontario province, which only received $267M from gambling in the 2nd Quarter of 2022. The annual projection implies that the local budget received over $1B from casinos and other forms of gambling in the previous year.
Such impressive figures for casino-related tax revenues in Ontario became possible due to market liberalization in 2021 and 2022. If other provinces follow the example, an additional tax flow into the state economy will count several billion dollars per year. The biggest impact would have igaming liberalization. The current online gambling trends like mobile play, cryptos, and VR casinos make this niche the most perspective regarding future growth and potential tax income.
Direct tax revenue is only a part of the benefits to the budget produced by casinos. The economic effect of gambling is much bigger. The investments in capital construction generated by the industry in the recent year surpassed $10B. It produced revenue and additional jobs for other industries, which also generated tax income for local and state budgets.
Add up gambling license fees to the mentioned above to see that the casino industry could be one of the major drivers of the Canadian economy in the current decade.
3. Land-Based Casinos Encourage Tourism
Many gamblers prefer to play online, cause it’s cheaper and doesn’t require much time. They just choose a suitable internet casino at BestCasinoPlay and start gambling in minutes. Around 4 million players per year visit land-based casinos as well. They search for a unique social experience no online gambling site can offer.
A big part of these 4 million are tourists who arrived from other provinces or abroad. They spend money not only on the casino itself but also on local accommodations, food, transport, and other services. It results in numerous benefits to the regional and province’s economy, labor sector, and entertainment sphere.
Canadian mortar-and-brick casinos have lots of other attractions except for gambling. They’re designed as stay-and-play facilities with all the amenities from luxury hotel rooms to spas, entertainment halls, restaurants, and bars. Many of them are built in the most picturesque places in the country, which works like a magnet for tourists.
A perfect example of a successful casino project that highly contributes to the tourism industry is Niagara Fallsview Casino Resort. It costs $1B of investments and generates a few hundred million dollars in revenue annually. Tourists from other regions, and provinces mostly generate the profit, and countries who come to see Niagara Falls, play at a casino, and stay for a weekend in the local luxury hotel.
Summary of the Economic Effect of Casinos in Canada
The casino industry is among the most promising spheres of the Canadian economy. It already generates a $12B+ turnover, and many analysts estimate that the figures will reach $50B+ up until the end of the decade. This will also result in tens of thousands of new jobs and significant tax revenues for the state budget.
An anticipated future economic effect of gambling will be possible if the government continues the liberalization of the casino sphere, especially igaming. The successful example of the Ontario province shows that the possible benefits outweigh the minor drawbacks it brings.