Page 26 - Estimates of Public Entities Revenue & Expenditure 2023

PROVINCE OF THE EASTERN CAPE ESTIMATES OF PUBLIC ENTITIES REVENUE AND EXPENDITURE 2023/24

7. 2022/23 performance review

7.1. Key Achievements

During 2022/23 Gambling Tax revenues have shown an improvement. The ECGB remains one of
the largest contributors of tax revenue to the provincial fiscus in terms of the gambling and betting

taxes collected from licensees.

The entity has contributed R143.8 million in tax collections to the provincial fiscus as at the end of
the third quarter, ending December 2022. Quarter three tax revenues have surpassed pre-
pandemic revenues by 26 per cent. In addition, 4 new licenses have also been issued that further

contribute to revenue generation.

As at the end of December 2022, the entity has conducted compliance audits to ensure that

licensees comply with the Eastern Cape Gambling Act, other statutory legislation and commitments
made prior to award of licenses. These results will be reported at the end of the financial year as a

measurement of the Gambling industry compliance maturity level.

In addition, 38 revenue audits have been conducted in order to ensure tax revenue is valid, accurate
and complete, and 7 sweeps on possible illegal gambling in the province have been carried out.

7.2 Key Challenges

• The industry is currently in recovery mode, however, the looming and continuing load-shedding

scourge has an adverse impact, particularly on the Limited Payout Machine sector.
• Litigation challenges against regulatory decisions of the Board have continued in the current

financial year. ECGB has successfully defended these cases.
• The Eastern Cape remains the only province in the country that does not have an indefinite

licensing regime, and where bookmaker tax is not zero-rated for punter’s winnings on sports
betting. This makes the province less competitive with national operators and serves to stunt the
growth in both provincial investment and tax revenues.

• Unregulated Internet gambling may lead to potential loss of revenue for the Provincial fiscus.

8. 2023/24 Performance Outlook

Investigating, considering, and awarding licenses and certificates to suitably qualified applicants,
especially the key licenses such as Casino, Type B, Independent Site Operator and Bookmakers.

A total number of 4 licenses to be issued during the MTEF period.

Conduct sweeps in the province to protect public interest and licensed operators from illegal
operators. The entity has a planned target of 30 sweeps during the MTEF period.

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