Sri Lanka Sets Mid-2026 Deadline for New Casino Regulatory Body

Sri Lanka’s gambling sector entered a new regulatory phase after Parliament passed the Gambling Regulatory Authority Bill on 19 August 2025, with the measure later certified as the Gambling Regulatory Authority Act, No. 17 of 2025. The law establishes a single authority to regulate gambling, collect related revenue, promote transparency and good governance, curb illegal gambling, and support tourism and economic development.

The bill was first gazetted on 27 May 2025, and reporting at the time said it was issued under the direction of President Anura Kumara Dissanayake in his capacity as Minister of Finance, Planning and Economic Development. Cabinet approval preceded its submission to Parliament.

At the center of the reform was the creation of the Gambling Regulatory Authority (GRA). The new body was mandated to license, monitor, and enforce compliance across all gambling activities. Revenue collection, transparency, and the prevention of illegal operations were identified as core responsibilities.

The Act replaced several long-standing statutes that were no longer fit for purpose. The Horse Racing Betting Ordinance, Gambling Ordinance, and Casino Ordinance were formally repealed. In their place, a single consolidated framework was introduced to govern the entire industry.

Economic considerations played a major role in shaping the legislation. Gambling was increasingly viewed as a strategic component of Sri Lanka’s tourism and entertainment offering. Policymakers argued that stronger regulation would attract reputable operators and higher-quality investment.

Online gambling emerged as a central concern during parliamentary and committee discussions. Officials disclosed that around 60% of casino users were already gambling online, while most digital operators remained unregistered and untaxed. The Bill introduced licensing requirements aimed at bringing these activities under formal control.

The Committee on Public Finance reinforced the need for swift implementation. The Finance Ministry and Inland Revenue Department agreed to establish the Authority by June 30, 2026. Foreign technical expertise was also proposed to support the development of the regulatory framework.

Regulatory reform was closely linked to international compliance obligations. Sri Lanka’s anti-money laundering and counter-terrorism financing framework was scheduled for review by the Financial Action Task Force. Lawmakers argued that a formal gambling regulator would strengthen transparency and reduce systemic risk.

Despite broad support, concerns were raised about the GRA’s independence. Policy analysts warned that excessive ministerial influence could undermine the perception of integrity. Comparisons with Singapore highlighted gaps in harm-minimization tools and online enforcement powers.

Fiscal changes accompanied the regulatory overhaul. From January 1, the casino entry levy for Sri Lankan citizens was doubled from USD 50 to USD 100, while the betting and gaming tax rose from 15% to 18%. Authorities expected the measures to boost state revenues as tourism activity recovered.

The Bill also reflected growing awareness of social responsibility. Provisions were framed to reduce harm, protect vulnerable players, and encourage responsible gambling practices. Supporters argued that regulation, rather than prohibition, offered the most sustainable path forward.