Thursday, February 24, 2005
Government is banking on revenues of $1.3 million from betting shops during the next fiscal year, according to the budget that was unveiled in Parliament on Friday.
But Lee Beauchamp, general manager of Seahorses betting shop believe that estimate, which is the same as the amount raised two years ago, is too high. He says it’s more likely to be $800,000, the amount Government expects to raise during the current fiscal year, which ends March 31.
That’s because, Mr. Beauchamp says, fewer punters are willing to part with their gambling dollars at local betting shops because they are subject to a 20 per cent tax.
They are betting instead in tax-free cyberspace. Others avoid taxes by using illegal brokers. All of this means Government is being deprived of revenue.
Mr. Beauchamp said hundreds of Bermudians spent money betting on horses and other sports events at the island’s three betting shops each week, but the numbers are falling.
He has asked Government officials to consider halving the tax or taxing the betting shops directly, but this has fallen on deaf ears.
People still prefer to bet with cash, instead of using their credit cards over the Internet, but not if they have to pay 20 per cent.
Mr. Beauchamp believes he is fighting a losing battle —what Government wants to be seen coming down on the side of gamblers?
But in his view, maintaining the betting tax rate at 20 per cent amounts to a missed opportunity. Lower taxes would keep more gamblers’ money on the island and ultimately means more revenue for Government.
“People are going to gamble no matter what,” he said.
Online gambling is an Israeli hit
By Galit Yemini
"Israelis really like playing casino games, they're quite hooked on it," said Ira Gladnikoff, vice president of Swedish online gambling company OnGame. She added that Israelis are particularly prevalent visitors on online gambling sites. "That's why we will be running a site specially in Hebrew, despite it being such a small country."
OnGame runs the online site www.pokerroom.com, considered the fifth-largest online poker web site in the world. Some 3.5 million surfing punters a day place around $13 million on bets.
The local potential is so great that OnGame will be launching a campaign to teach Israelis how to play the game.
"Initially we will open real [not online] poker classes in Tel Aviv," Gladnikoff said,"with tutors brought specially to Israel from overseas. Poker is a game that requires 70 percent skill and 30 percent luck, so there is something worth learning."
Americans account for the vast majority - some 80 percent, according to the VP - of OnGame's customers,"but there are loads of Israelis that play on the site, and they are considered good players."
Gladnikoff, a Swedish Jew who has family in Israel, thought up OnGame's venture in Israel, for which the company is to spend $100,000 in the first stages.
Online poker is estimated at taking in some $2 billion a year in bets, and that's just part of the phenomena of online gambling worldwide. Another major player in the field is Casino-On-Net, whose software was developed by Random Logic, ironically an Israeli company, based in Tel Aviv. Ironic because according to Israel's strict gambling laws, punters are forbidden from gambling, even online. The company therefore decided to run its casino from Gibraltar, and the site is barred to surfers from Israel.
Another local online gambling company, King Solomon, found another way round the legal restrictions. The company, which takes in bets of $1.5 million a month and makes profits of $400,000 to $600,000 a month on its site, kings.co.il, runs its online casino from South Africa. Its support services though are available in Hebrew.
