Sri Lanka’s government is looking to casinos to transform the island nation into Asia’s newest tourism hotspot, but the strategy is sparking concerns among political and religious leaders.
Small, low-key, tourist-only gambling halls in and around the capital of Colombo have been tolerated in the conservative, mostly Buddhist nation for years. But in 2010 the government formally legalized them with the aim of luring more visitors and boosting an economy battered by decades of ethnic violence.
The government recently approved resort development plans by John Keells Holdings, the country’s biggest listed company in terms of market capitalization, and Australian casino tycoon James Packer’s Crown Limited. Both have been handed a generous 10-year tax holiday, and both are expected to including casinos.
Officials stress that both projects, expected to break ground before the end of the year, will create thousands of jobs and attract big-spending foreigners. The country hosted a record 1 million visitors last year, with between 1.2 million and 1.3 million expected this year. The government has set a target of doubling annual visitor numbers to 2.5 million by 2016.
Yet the main opposition party has balked at the projects, not on moral grounds, but because of the generous tax breaks. “What we are saying is that if the country is to benefit, they must be taxed and regulated,” United National Party lawmaker Harsha de Silva said.
The UNP is pushing for a “sin tax” on casino developments similar to the heavy duties on alcohol and tobacco.
The government also finds itself having to placate the country’s influential Buddhist clergy by saying all new casinos will be restricted to a designated zone in Colombo and will be closed to Sri Lankans.
Buddhist monk Athuraliye Rathana, a lawmaker and senior leader of the National Heritage Party, has warned the government that these and other details, initially set down in the 2010 legislation, must be strictly followed.
“We oppose gambling, but it is not practical to eradicate it completely,” he said.
“The government has at least said there will be a separate area for gambling. So let us see how they implement it,” said Galagodaatte Gnanasara, another Buddhist monk and secretary of the hardline Bodu Bala Sena organization.
The government is still working out the details of a regulatory framework for the industry.
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