The Southeast Asian nations of Laos and Malaysia see taxes from online gaming as a possible way to lift economies slammed by Covid-19.
Recently, Malaysian Deputy Communications and Multimedia Minister Datuk Zahidi Zainul Abidin spoke before parliament about his proposal of new laws to allow for the taxation, regulation and licensing of online gaming. The Ministry of Finance has been asked to write amendments to the Common Gaming House Act of 1953 to make this possible.
The minister said, “If we do not license, then individuals in Malaysia who are gambling with these foreign sources, we cannot tax them.” He added, “That is why we are proposing to the MoF to draft a law or a new Bill so that we can license it. We have to give it a license so that we can monitor it and we can generate income which then can sustain us regulating it.”
The challenge, said Zahidi, is that the existing legal framework is too antiquated to regulate online gaming.
Malaysia has been mulling such a change for a while, although the Covid crisis interrupted that process. Nevertheless it would take a major change in attitude on the part of the government, which has sought to crush illegal online gaming sites.
Meanwhile, neighboring Laos is way ahead of Malaysia in having already issued three online gaming licenses, according to Cherry Interactive General Manager Danny Too, who spoke to Asia Gaming Brief.
The Covid crisis has softened many anti-gaming attitudes among normally hardline Asian countries. Leading the way was the Philippines, whose Philippines Internal Gambling Operator (PIGO) has begun issuing licenses, and whose model other countries in the region are studying closely.
One part of the Philippines’ model that might be suited to Malaysia, said Too, are the Philippines Offshore Gambling Operators (POGOs) in Manila. They serve Filipinos who leave the country’s jurisdiction, but also have faced allegations of marketing to Chinese gamblers. Too said existing POGO operators seek new jurisdictions where they can have special economic zones, such as in Vientiane, capital of Laos.
Many Asian countries are looking to identify new revenue sources to help boost their economies, which are struggling to recover from Covid-19. But the likely disapproval of China, which opposes more offshore online gaming will be a factor in the growth of iGaming in the sector.
