Economist warns Philippines igaming could affect retail sector
Economist Rober Dan Roces spoke on the effects of igaming on the retail sector at the Cebu Province Economic Forum, saying igaming accounts for 5% of household spending in the Philippines, the equivalent of PHP400 billion (US$6.87 billion)1 PHP = 0.0172 USD
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Roces also discussed how igaming is affecting stores as household budgets are getting tighter.
“For retailers, this is an early warning signal,” Roscoe said. “Gambling isn’t necessarily bad for the economy, but it means pesos are flowing away from malls and stores. Our newest competitor is not another retailer or developer — it’s an app draining pesos that could have been spent in our malls.”
Calling this spending “wallet diversions,” Rosese discussed that while spending in households has remained strong, the effects could mean consumption-led growth in the economy may falter if the money is instead spent online instead of in local stores.
While Cebus’s economy is above average because of household spending and tourism, it may begin to suffer because of slowing investment, reliance on imported goods, and shifting consumer behaviors.
It was announced this month that Philippine igaming operator DigiPlus had partnered with payment provider Bayad Center as its payment channel after the Bangko Sentral ng Pilipinas’ order to remove gambling-related apps from e-wallets.
Abi Bray brings strong researching skills to the forefront of all of her writing, whether it’s the newest slots, industry trends or the ever changing legislation across the U.S, Asia and Australia, she maintains a keen eye for detail and a passion for reporting.
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The Backstory
How online gambling became the next policy flash point
The current debate did not emerge in a vacuum. Regulated markets have scaled quickly, giving lawmakers fresh revenue options and regulators new headaches. Ontario, the largest regulated online market in North America outside the United States, posted its second best month on record this spring, with operators generating C$313.3 million in April, up 6% from March. Casino products made up 78% of revenue, underscoring the heft of online slots and tables in a mature regime. Alberta is now poised to follow after lawmakers passed the iGaming Alberta Act, setting up a rival market pending Royal Assent, according to Ontario iGaming’s latest tally. The speed and scale of that growth frame the stakes for jurisdictions still weighing legalization, tax rates or tighter controls.
At the same time, operators and investors are betting the runway remains long. Despite bouts of earnings volatility, a recent Jefferies note argues that 2025-26 could be “really big” for digital gambling as brands reach profitability and cash flow inflects. The firm sees total addressable market expansion driven by new states, deeper product engagement and the higher-margin economics of online casino, as detailed in Jefferies analyst David Katz’s sector call. That optimism collides with growing political pressure over addiction risks and shifting household budgets, setting up the policy fights now unfolding.
Wallet share shifts ripple through Main Street
In the Philippines, where consumer spending powers growth, early signals are flashing for retailers. At the Cebu Province Economic Forum, economist Rober Dan Roces warned that igaming already claims roughly 5% of household outlays, or about PHP400 billion, draining pesos that might otherwise go to malls and stores. He described the trend as “wallet diversions,” cautioning that consumption-led growth could falter if more spending migrates from local shops to mobile apps. Cebu’s economy, buoyed by tourism and above-average household demand, still faces pressure from slowing investment, import reliance and changing behaviors, he said. The remarks came as a leading operator, DigiPlus, aligned with Bayad Center for payments following a central bank order that e-wallets delist gambling apps. The forum’s alarm bell is detailed in reporting on Cebu’s retail exposure.
For policymakers elsewhere, the Cebu lens offers a concrete measure of igaming’s opportunity cost. It is not a moral indictment as much as it is a ledger entry. Every peso or dollar diverted online is one less rung in local retail’s multiplier chain. That calculus is informing tax and regulatory proposals in U.S. capitols and fueling calls for outright bans from church leaders in the Philippines. It also underpins the industry’s push for clearer, stable rules that can support compliance investments and responsible gaming tools at scale.
From the pulpit to the palace: a Cebu appeal
Moral pressure intensified in late July, when the archbishop-designate of Cebu, Alberto Uy, issued a direct appeal to President Ferdinand Marcos Jr. to permanently ban online gambling. Framing the issue as a public harm that “disguises itself as entertainment,” Uy urged leaders to protect human dignity over state revenues, reflecting sentiments the Catholic Bishops’ Conference voiced earlier. His Facebook statement on the danger of online gambling and follow-on coverage capture a rising church-state friction point.
The appeal lands as regulators tighten payments and as economists warn of retail displacement. It puts Malacañang on notice that any incremental loosening, or uneven enforcement, could meet organized opposition. For operators, it raises reputational risk just as partnerships and payment channels become the target of policy and public opinion. The church’s posture may not dictate law, but it shapes the political cost of inaction.
Tax math reshapes the U.S. playbook
In Maryland, a sweeping proposal to double the online sports betting tax to 30% and raise table game levies to 25% triggered a fast repricing of digital gaming stocks. As analysts at Deutsche Bank and Truist warned, the measure would sting cash flows at DraftKings, FanDuel parent Flutter, BetMGM and others, with MGM National Harbor also taking a hit on tables. The initiative seeks nearly US$1 billion in new revenue, but it skips igaming legalization, which analysts say could eclipse sports betting receipts.
The larger signal is political. If one state executes a steep tax hike, others may follow as budget cycles open, from Michigan to Louisiana. The industry’s near-term risk is not demand, but policy. That dynamic complicates investor models even as user engagement grows and product mix skews to higher-margin casino where legal. It also gives oxygen to a compromise path in some states: accept higher taxes now in exchange for online casino later. That trade, if it materializes, could realign lobbying priorities and operator market entries in 2025.
Why investors still see upside
Despite the Maryland scare, the long-term bull case rests on scale and mix. Jefferies’ David Katz projects a U.S. digital market swelling toward US$50 billion by 2030, with online casino margins outpacing sports betting. The firm raised targets for Rush Street Interactive, Gambling.com and Sportradar, and kept DraftKings as its franchise pick based on margin expansion and customer spend per player. Catalysts include new state launches, continued per-capita handle growth and the popularity of proposition bets that favor data providers like Sportradar.
The thesis hinges on two assumptions. First, regulatory expansion continues, even if uneven. Second, operator discipline on promotion and customer acquisition persists, allowing the scale benefits investors expected in the last cycle to finally land on the income statement. Both face political risk, but the Ontario experience shows that when rules stabilize, markets can quickly mature and generate steady tax streams without crushing operators.
Ohio’s test of appetite and guardrails
Ohio is the next crucible. Gov. Mike DeWine has warned that full-scale igaming would put “a casino” on every iPhone, elevating risks of addiction and youth access. He stopped short of promising a veto, but his message is clear: do not confuse tax potential with free money. Lawmakers have filed two bills. The House proposal would open only online slots and tables, while the Senate’s goes further with a weekly wagering cap and legalization of an online lottery and horse wagers. The contours are laid out in reporting on DeWine’s remarks, and the texts are available as HB 298 and SB 197.
What Ohio decides will echo. A narrow bill with strict caps could become a template for cautious states. A broader bill paired with robust responsible gaming mandates could set a different precedent. Either way, the session will test whether legislators prioritize near-term budget relief, consumer protections or political optics as neighboring markets evolve. In that sense, Ohio sits at the intersection of Ontario’s proof of concept, Maryland’s tax tremors and Cebu’s warnings from both the marketplace and the pulpit.
The backstory is simple but stark. Demand is real. So are the social and fiscal trade-offs. As more jurisdictions move from sports betting to casino online, the policy choices made now will determine who captures the next dollar of digital play, how it is taxed and what protections are built around it.
