Sri Lanka is embarking on an unprecedented reform of the gambling industry: from offline casinos to online platforms, from dealing mechanisms to intermediary systems, the entire gambling regulatory system is about to be restructured—the core goal of this reform is to turn the gambling industry into a national economic engine.
Currently, the "2025 Gambling Regulatory Authority Act" has been submitted to the parliament for review and is expected to be officially passed within the year. This act aims not only to legalize gambling operations but also to establish a unified regulatory body, the "National Gambling Regulatory Authority (GRA)," which integrates functions such as license issuance, tax collection, anti-money laundering, and risk control, led by the Minister of Finance with members including the Director of Financial Intelligence and the Chief of Police, reflecting the government's high regard for upgrading the gambling industry.
Another highlight of this reform is the planned introduction of the "Junket intermediary system," which allows third-party institutions to obtain licenses to engage in traffic driving and high-stakes gambling referral services. This is widely interpreted as a return version of the "intermediary license" and means that Sri Lanka may become another emerging country trying to introduce VIP gambling market mechanisms after Macau.
In addition, the tax rate and entry fees are also adjusted simultaneously—the gambling tax rate is raised from 15% to 18%, and the entry fee for foreigners is doubled to 100 USD. This combination aims to increase government revenue while raising the threshold for gambling access, to balance industrial development with social risks.
This reform is not just on paper. The "City of Dreams Sri Lanka" complex project, a collaboration between Melco Resorts with Chinese backing and local giant John Keells, has entered the implementation phase, with a total investment of over 1.2 billion USD, expected to open in the third quarter of 2025, including casinos, hotels, and retail spaces, intending to turn Sri Lanka into the "Macau of South Asia."
It is worth noting that this reform is also driven by reality: Sri Lanka's finances were on the verge of collapse during the pandemic, with high foreign debt and a slump in tourism, while gambling is seen as a viable path to attract foreign investment and increase foreign exchange earnings.
However, observers remind investors and practitioners to remain cautious: Is the policy sustainable? Is the regulation strict enough? Once gray production infiltration and money laundering issues emerge, it could trigger regional security and reputation risks.
Can Sri Lanka break through economically with the gambling industry? This may be a high-risk gamble—the outcome is still unknown, but the game has already begun.
