In 2025, Sri Lanka is undergoing a sweeping transformation of its gambling industry. The government is moving forward with the establishment of an independent regulatory authority, revamping outdated laws, restructuring licensing fees, and attracting major international investments — all in a bid to modernize the sector and increase state revenues.
Independent Gambling Authority to Lead Oversight
A key part of the reform is the creation of the Gambling Regulatory Authority, a new independent institution tasked with supervising all gambling operations in the country — from land-based casinos and betting shops to online platforms and offshore operators, including those in the Colombo Port City.
Approved by the Cabinet in April 2025, the draft legislation proposes repealing three outdated ordinances — the Betting on Horse Racing Ordinance, Gambling Ordinance, and Casino Ordinance — in favor of a single modern legal framework. This centralized approach aims to close regulatory loopholes, eliminate jurisdictional overlaps, and strengthen enforcement.
Revised Licensing Fees and Taxation Targets Illegal Operators
Alongside structural reforms, Sri Lanka is implementing a new licensing model to boost transparency and curb illegal gambling. According to the Ministry of Finance:
- Existing casino operators will pay $1.55 million for the first five years and $4.66 million for the next 15 years.
- Renewal fees are set at $31 million.
- New entrants investing at least $250 million will face a licensing and renewal fee of $31 million each.
- Projects exceeding $500 million in investment will be eligible for an initial licensing fee of $15.5 million.
The 2025 budget also raised the Gross Gaming Revenue (GGR) tax from 15% to 18%, and doubled the casino entry fee from $50 to $100. These measures are designed to enhance state revenue while discouraging unregulated or underreported operations.
Global Investment: Melco’s $1B Casino Signals Confidence
Sri Lanka’s regulatory overhaul is already drawing interest from major industry players. Melco Resorts & Entertainment, a leading casino developer in Asia, has secured a 20-year license for its City of Dreams Sri Lanka project — a $1 billion integrated resort currently under construction in Colombo, in partnership with John Keells Holdings.
The project is expected to go live in Q3 2025, positioning Sri Lanka as a key player in South Asia’s gaming and tourism landscape.
Building a Transparent and Sustainable Gambling Market
Beyond taxation and investment, the broader goal of the reforms is to build a responsible and transparent gambling ecosystem. The Gambling Regulatory Authority will oversee not only licensing and compliance, but also policy development, anti-money laundering efforts, and market integrity.
This comprehensive approach reflects Sri Lanka’s strategy to reposition itself as a stable and competitive market in Asia, especially as online and offshore gambling continue to rise across the region.
Conclusion:
Sri Lanka’s gambling reform is not just about regulating — it’s about reinventing. With a strong legal foundation, independent oversight, and investor-friendly conditions, the country is poised to redefine its gambling industry for a new era of growth and accountability.
