Barbados gambling economy

The role of gambling in the economy of Barbados

1) Brief context of the economy

Barbados is a small open economy with a high role for tourism and services. According to the World Bank, the nominal GDP of the country in 2024 is estimated at about $7.2 billion (current US dollars). This sets the scale against which any sector, including gambling, is evaluated.

2) How the state monetizes the sector: major channels

Taxes and duties (Cap. 60). The budget receives revenues through licenses, duties and fees on bets/turnovers set by Betting and Gaming Duties Act, Cap. 60 and by-laws. The law covers, among other things, pool betting, including cases when the promoter is outside Barbados (the obligation to pay the fee falls on the local representative). There are also annual/semi-annual license regimes with specific validity periods.

Licensing and control (Cap. 134A and Cap. 134). Betting and Gaming, Cap. 134A regulates slot machines, halls, approved premises, club gambling and charity lotteries; Gambling, Cap. 134 establishes basic prohibitions (including "common gaming houses") and procedural powers. This is the legal "core" through which activities are formalized and fees are levied.

National Lottery as a quasi-fiscal tool. The Barbados Lottery (operator - IGT Global Services Ltd., Barbados branch) transfers funds to beneficiaries - Nats. sports council, Cricket Federation, Olympic Association, Turf Club - effectively funding the sport/culture and reducing the burden on the budget.

3) Segments where value added is created

Lottery and scratch cards. Direct ticket sales → operator's margin → payments to beneficiaries and taxes. The contribution is sensitive to the tourist season and points of sale.

Slot machines and halls at hotels/shopping centers. A small but steady flow of employment (cashiers/operators/security) and related visitor expenses (F&B, transport). Legal framework - Cap. 134A.

Horse racing and sweepstakes. Asset for event tourism: days at the hippodrome, rates, food, merch. Plus - training/horse care and related Turf Club services. (Indirectly confirmed by lottery beneficiary status.)

Tourist cruises with casinos. Revenue is generated on board in neutral waters, but "ground" effects remain in Barbados: port fees, excursions, F&B, pre-/post-voyage purchases.

4) Link with tourism: demand multiplier

Tourism is a key driver of demand for entertainment. Under the WTTC methodology, tourism contributions include direct/indirect/induced effects; for Barbados, the WTTC annually publishes facts and projections on the sector's contribution to GDP/employment, spending patterns and tax revenues. The growth of tourist traffic directly supports the attendance of halls, lottery turnovers and visits to the hippodrome.

5) Channels of influence on employment and SMEs

Direct employment: cashiers, lottery hall/shop operators, racetrack employees.

Indirect: cleaning/security, logistics, ticket printing/printing, IT support of systems.

Induced: consumption of households receiving income from the sector.

SME effect: restaurants/bars near the halls and hippodrome, merch and local services during events.

6) Budget: Where the money comes from and how to value it

1. Licenses and duties (Cap. 60): fixed fees + rates/duties, including pool betting with an "external" promoter through a local representative.

2. Income tax/VAT equivalent with operating margin and salaries in the supply chain.

3. Quasi-fiscal transfers through the lottery - targeted support for sports/culture (reducing pressure on the development budget).

7) Risks and externalities

Social costs: gambling addiction → the need to finance RG programs and assistance lines (logically through mandatory deductions from operators).

Compliance and AML/CFT: without proper control - reputational costs for the financial system.

The "gray zone" is online: the lack of a separate licensing regime for online casinos shifts demand abroad and reduces local fiscal effects. Advertising rationing and geo-filtering are critical. (There is already a regulatory framework for offline - Cap. 134A/Cap. 134; tax contour - Cap. 60.)

8) Which strengthens sector contribution (2025-2030)

Updating/codification of the rules for online with the transfer of part of the demand to the regulated zone (B2C licenses, GGR reporting, white-list providers/payments). (Extrapolation based on the current Cap fiscal framework. 60.)

Event tourism on the basis of a hippodrome and sports (Turf Club, cricket) - a calendar of events with packages for cruise and hotel guests.

Transparent RG obligations (self-exclusion, limits, prevention financing) - increase the social acceptability of sector growth.

Digitalization of the lottery (results/promotions/geo-navigator of points of sale) - increasing turnover without increasing costs.

9) Policy and recommendations

Tax design: transition to GGR taxation instead of rate turnover (global trend) while maintaining fixed license fees; Cap. 60 already provides an administrative basis for fees/licenses.

Transparent reporting to lottery beneficiaries (sports/culture) - public annual reports increase confidence in the quasi-fiscal function.

Compliance infrastructure: audit of RNG/providers, transaction monitoring, interaction with banks/telecom.

Linking to the climate sustainability agenda. At the level of the entire economy, Barbados implements innovative financing mechanisms for sustainability (e.g. climate debt swaps), and the gambling sector can act as an additional source of targeted fees/RG/ESG fund.

10) Final role evaluation

Barbados' gambling sector is compact but economically significant through tax-licensing revenues, sports/culture support (via lottery), SME jobs and demand, and a strengthening tourism multiplier.

Sustainable contribution growth is possible with accurate legalization/ordering of online, development of event tourism and strengthening of RG/AML contours. In conditions of GDP of about $7 billion, even a moderate increase in turnover and formalization of "gray" demand give a disproportionately noticeable effect on the budget and local communities.

Sources: laws and materials of regulators (Cap. 60, Cap. 134A, Cap. 134), official Beneficiary and Operator Lottery (IGT) information, and WTTC methodology and publications on the economic contribution of tourism determining the sector's related effects.