The role of 

gambling in revenue generation is not new; even during the era

of Kautilya, gambling was a state-regulated industry with a 5 per cent tax on winnings. Many
Indian states have realised the importance of the gambling industry. Calculations from an RBI
report, ‘State Finances — A study of Budget 2002-03’, shows that there is a tremendous increase
in the states’ profits from lotteries. The aggregate losses of Rs. 71.41 crore (Rs. 714.1 million) in
the year 2000-01 turned into whopping profits of Rs. 503.21 crore (Rs. 5.232 billion) in the year
2002-03. In the same year, the combined profit from the state-run lotteries was 6.65 per cent of
the revenue receipts from the lotteries. The highest profit (in percentage terms) was for
Meghalaya (93.96) followed by Mizoram (93.5), and the lowest was in Haryana (0.19) followed
by Goa’.46 A review of the tax revenue to Goa from the casino industry reveals that Goa
collected Rs. 135.45 crores as tax revenue from the industry under various taxation
heads.47 This, however, does not take into account the employment and tourism generated and
the revenue arising to the state and its people from these activities. A state can therefore,
impose tax on sports betting at a similar footing to earn much needed revenue for the
development of sports in the state as well as garner more support for the domestic games.