Gambling Tax Hk
Although Hong Kong authorities strongly insist that locals place bets through entirely legal methods such as gambling with the Hong Kong Jockey Club, it hasn’t put a stop to online sports betting as locals continue to search for better odds, broader markets, and more significant bonus offers internationally.
The Highs and Lows: Gambling Winnings Tax. There is a huge disparity in the quantity of tax collected across legal gambling jurisdictions. In some countries, punters can expect to lose up to 10% of their winnings to the taxman, whereas in other countries this can be between 1-3%. For instance, in Hong Kong, gambling is generally illegal except for certain licensed or exempted activities. “Games of chance” or “games of chance and skill combined” (or even games with prizes which do not involve a substantial degree of skill) fall within the ambit of the Gambling Ordinance.
Hong Kong authorities have done little to ‘block’ international bookmakers from entering the market. Online betting sites are accessible in Hong Kong, and international bookmakers continue to entice locals with excellent promotions for new members. Authorities are disinterested in prosecuting individual bettors and are, of course, actively chasing the ringleaders of underground casinos and gambling hubs instead.
As interest in betting on sports online continues to increase in Hong Kong, so does the number of options for gamblers. We’ve compiled a shortlist of top-ranked bookmakers that are available in Hong Kong, appreciated for the below criteria:
- Fantastic odds that provide significantly more value than HKJC
- Phenomenal welcome offers and bonuses
- Reputable and trusted online gambling brands
Macau's tax revenue from the gambling industry plunged by 56.5 percent year-on-year to 21 billion patacas (HK$20.34 billion) during the first five months this year, according to data from the Financial Service Bureau of Macau. This was only 42.09 percent of the initial budget for the period. Gambling tax in Australia doesn’t apply to winnings if they were made via an online casino or a land-based casino. Again, casino operators are obliged to pay license fees in addition to taxes on gambling although the exact numbers vary from state to state.
History of Sports Betting in Hong Kong
For many years the only legal betting available in Hong Kong was at horse racing tracks. This changed in the 1970s when off-track bookmakers were opened in response to the amount of illegal gambling taking place. These were run by the Hong Kong Jockey’s Club, a group who still control all regulated betting activities in the country. Although they started out as a racing bookmaker, they have since expanded their range of market to include football and basketball betting, as well as the enormously popular Mark Six lottery [1].
The HKJC is a non-profit organization which is the largest taxpayer in the region as well as private charity contributor. It is run by volunteers and in addition to sports betting the HKJC organizes the horse races at the two Hong Kong tracks – Happy Valley and Sha Tin [2]. The group also arranges charity events, dinners and social meet-ups for its estimated 23,000 members.
This monopoly has led to a number of illegal operations opening up across Hong Kong. Police seized around $350 million HKD over the 2014 World Cup alone [3] after raiding land based operations run by gangs with the use of online betting sites.
Hong Kong’s Online Sports Betting Options
It addition to its land based operations, HKJC also has a monopoly for online betting in Hong Kong. Their site allows you to wager on horses, football and to buy lottery tickets. In 2002 the HKJC position was strengthened when it was made illegal both for offshore companies to offer their services in Hong Kong and for residents to place wagers with them. Under this new law, representatives from companies providing betting services to Hong Kong residents could face 7 years in prison along with a $5 million HKD fine, while locals found using these website could face up to 9 months imprisonment and a $30,000 HKD fine [4].
As a result of these tough new laws, many international betting sites do not offer their services to customers in Hong Kong. However, as is the case in many regulated markets, there are still large number of companies who insist on flouting this law. In 2011 it was estimated that a third of all wagers on horse racing were placed on illegal betting sites [5]. This, along with the high taxation the HKJC is subject to is seen as a very realistic threat to their operations, despite contributing over $1 billion HKD to the government and the same amount to charities each year.
Gambling Tax Us
Winnings are Tax Free
Currently gambling winnings are not subject to income tax in Hong Kong, although the HKJC is subject to high rates on its revenues. While there is speculation that taxes may be applied to individuals should the online market become relaxed, those using illegal foreign sites will still be able to withdraw tax free as there is no structure in place to charge winnings.
Using Foreign Bookies
Strictly speaking, it is illegal to wager online anywhere other than on the HKJC website. However, tens of thousands of Hong Kong sports fans ignore these laws by choosing to bet online with foreign bookies. Every site that accepts Hong Kong customers offers both English and Chinese language support.
One thing to note is that not many of these sites accept Hong Kong Dollar currency, so you will have to convert your currency into US dollars, Chinese Yuan or Euros. Often the sites will do this for you by taking your deposit in HKD and converting it, which may leave you vulnerable to exchange rate fluctuations.
A lot of Hong Kong banks and credit cards will not process transactions to international betting sites, however you may find some Visa and MasterCard transactions will go through, especially if the card has been issued by a company outside of Hong Kong. Failing that, online wallets like NETeller, Skrill or ClickandPay are good options. You can deposit money into these then transfer it around online as you like. These wallets can also be available in different currencies to HKD, which allows you to reduce currency exchanges if you are using several sites.
Future of Online Gambling in Hong Kong
Even with laws in place, as technology advances it becomes ever easier to access online bookmakers either directly or via other countries. The fact that many locals prefer to use foreign bookies ahead of the HKJC has presented lawmakers with a new set of challenges. It seems likely that in the future our current laws will be relaxed, and our betting market opened up to foreign companies. However, given that the Hong Kong government has a lot more pressing issues at hand, we may not see any market regulation for a long time. Luckily, users in Hong Kong still have plenty of options to choose from.
References
[1]Responsible Gamling Policy – The Hong Kong Jockey Club
[2]Horse Racing – Discover Hong Kong
[3]Illegal Betting World Cup – South China Morning Post
[4]2002 Hong Kong Internet Gambling Law – IT Law
[5]HKJC Faces Biggest Threat From Online Gaming – Bloomberg
The Hong Kong Government Policy is to restrict gambling, other than social gambling, to a limited number of controlled authorised outlets. In this way, while the public demand for gambling is met, regulation ensures that gambling opportunities are not excessive and possible harm to the community is minimized. According to the Gambling Ordinance (Cap. 148), all gambling activities are illegal except those authorised by the Government which includes authorised horse racing, football betting and Mark Six lottery, and betting premises licenced by the Government or those exempted under the Ordinance.
The illegal gambling market is sizeable and growing exponentially. During the World Cup 2014, the Hong Kong Police Force mounted vigorous operations in the territory against illegal gambling activities, resulting in seizure of cash and betting slips amounting to more than HK$750 million, a record high.
Increasing junket activities and illegal web betting
Illegal gambling operators and their agents (or junkets) have becoming increasingly aggressive and active in Hong Kong. Junkets not only offer incentives and loans for gamblers, but also provide ferry tickets and hotel accommodations for their customers to gamble at offshore casinos or casino cruises. Offshore operators are also increasingly deploying loyalty programmes to recruit new and young customers which poses a serious threat to Hong Kong.
Profit-oriented illegal bookmakers lure customers with credit betting, better price incentives, and more bet types, irrespective of their age and financial status. By offering discounts and loans, they encourage customers to chase losses, resulting in heavy gambling debts. Round the clock gambling opportunities provided by illegal operators often lead customers to bet instantly and continuously, making them more prone to excessive gambling.
Fuelled by the advancement of mobile technology and widespread use of smartphones and tablet computers, illegal gambling platforms are more readily available to the public in recent years. A study tracking web traffic found that at least 230,000 local residents patronise illegal gambling websites each month. The betting loss incurred each year is estimated at HK$12 billion, which is equivalent to 60% of the Government’s Community Care Fund. Should the money be ploughed back to society, Hong Kong people can benefit enormously from the provision of 17,000 additional public housing units, 100 secondary schools and close to 300 elderly homes.
The amount of wagers Hong Kong people placed with illegal bookmakers tops hundreds of billions of dollars each year, which is double the HK$150 billion recorded by the authorised betting channels. This growing trend also aggravates the numerous social and criminal problems and activities it brings to the community.
Illegal gambling in Hong Kong:
Illegal gambling is widely associated with criminal activities, in particular loan-sharking, money laundering, fraud and corruption.
Gambling Tax Uk History
Equally if not more damaging is the siphoning of public resources from the community. Illegal gambling operations neither pay tax in Hong Kong, nor make any contribution to Hong Kong charities.
Gambling Tax Hk 2020
In contrast, the Club is committed to providing regulated legal betting services to help the Government in combating illegal gambling in accordance with the Government’s Policy to restrict gambling to a limited number of controlled authorised outlets. Being a pioneer in responsible gambling practices, the Club implements a wide range of measures to encourage those who gamble to do so responsibly and to prevent underage gambling. It endeavours to strike a balance between meeting the demand for gambling while helping to minimise potential harm caused by gambling.