The Committee on Public Finance (CoPF) has renewed its call to expedite the establishment of a Casino Regulatory Authority, highlighting the loss of revenue to the state. The matter was discussed during a parliamentary session last week on 6 March, chaired by CoPF Chair Dr. Harsha de Silva, where lawmakers discussed gaps in casino taxation and financial oversight.
According to Dr. de Silva, Sri Lanka’s growing online gambling market is still mainly uncontrolled, even though land-based casinos are taxed. He stated, “Despite our efforts, the online gaming sector remains tax-free. We must move quickly to establish effective financial control.”
Reports suggest that the Attorney General’s Department has now been tasked with fast-tracking the necessary legislation to establish a regulatory authority. Lawmakers stressed that regulating online gambling could generate substantial tax revenue and prevent financial leakages.
Earlier on 24 February 2025, Sri Lanka’s Cabinet of Ministers granted approval to continue formulating the draft bill for a Gambling Regulatory Authority.
Cabinet spokesperson Nalinda Jayatissa confirmed that the approval had been granted, allowing the drafting process to proceed.
The proposed authority will oversee gambling institutions, regulate tax collection, mitigate social harm, enhance the tourism sector, and contribute to economic growth. The decision follows recent fiscal measures introduced in the 2025 budget to reform Sri Lanka’s gaming industry.
The 2025 budget presented by President Anura Kumara Dissanayake includes a series of tax reforms for the gaming sector. Among the key changes:
Sri Lanka currently has six licensed casinos: Bally’s, Bellagio, Casino Marina, Stardust, Continental Club, and The Ritz Club. Additionally, two new casinos, City of Dreams Sri Lanka and Majestic Pride Casino—a joint venture between Golden Island Hospitality Ltd and India-based Majestic Group Hotels and Casinos—are under development at Colombo Lotus Tower.
During the March 6 session, CoPF also discussed interim measures to tax online gambling businesses until the new regulatory framework is established. Dr. de Silva noted that the Inland Revenue Department (IRD) had previously denied the presence of online casinos operating from Sri Lanka, but investigations have now confirmed their existence.
“As a basic measure, why have you not taken action to charge them a tax in the meantime, before the new law is introduced?” he asked IRD officials.
Responding to the query, IRD Assessor Thanuja Perera said, “Within the issuing of the license of physical casinos, the online operations of the business are illegal.”
De Silva suggested that CoPF should play a key role in drafting new legislation to ensure proper regulation of both land-based and online gambling operations.
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